Veteran investor Mark Mobius says that the outlook for Bitcoin will remain dire in 2023
Even with a deep drop from the top, Mobius believes that the Bitcoin price could still drop by as much as 40%, down to $10,000 per coin by 2023. Mobius Capital Partners co-founder is the one who correctly predicted the Bitcoin crash. $20,000 this year.

At the moment, Mr. Mobius says that Bitcoin is not far from the $10,000 price after it broke through the technical support levels of $18,000 and $17,000. While Mobius says that Bitcoin can hold its value around $17,000 at the moment, the digital currency will continue to depreciate to drop to the 4-digit mark next year.

Famed investor at Franklin Templeton Investments explained that Bitcoin's downtrend was caused by the US Federal Reserve (FED) raising interest rates, leading to a series of countries tightening monetary policy simultaneously. In other words, the era of cheap money, which was the driving force for assets like Bitcoin, is over.

“With higher interest rates, the appeal of holding or buying Bitcoin or other cryptocurrencies becomes less attractive because the risks outweigh the benefits,” Mobius said.

Of course, there are proposals for paying 5% or higher interest to crypto depositors. However, many companies that applied this rate went bankrupt, in part due to the collapse of FTX. Therefore, when fear prevails, very few people choose to hold cryptocurrencies and that is the reason why their prices plummet.

In fact, there are many companies that raise cryptocurrencies at high interest rates and then lend them back at exorbitant rates. This is perfectly fine during peak times. However, as prices plunged and liquidity dried up, many of these companies collapsed. One such company is Celsius, which filed for bankruptcy protection last weekend. Another name, BlockFi, with its far-reaching links to FTX, has also collapsed.

Investor Mobius also said that the explosion of cryptocurrencies is related to the "money printer" of the Fed during the pandemic. When huge economic stimulus packages were enacted, cheap money flooded into assets, including cryptocurrencies. However, this favorable condition has disappeared with the sharpest rate hikes since the 1980s.

“Now, when the Fed withdraws the cash they have pumped out, difficulties will prevail,” Mobius said.

In 2022, Mobius' predictions for Bitcoin are quite accurate. In May, when the price of this digital currency was above $28,000, Mobius predicted it would break 20,000 then bounce back and return to $10,000. A few days ago, Bitcoin dropped to less than $15,500.

If what Mobius warns is true, the cryptocurrency market will lose a lot. In 2022 alone, $1.3 trillion has been blown out of the cryptocurrency market capitalization. Bitcoin, the largest cryptocurrency by market capitalization, has also slipped far from the $60,000 peak it hit more than a year ago.


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