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16.01.2023 05:01 PM
Peter Schiff: Bitcoin will never recover.

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At the start of the new year, the bitcoin cryptocurrency surprise made many people happy and saw a 30% price increase. Since the most recent local low, the price has risen by around $5,000, and it is now just above the previous high of $20,400. Nothing unusual, in our opinion, has occurred because the "bearish" tendency has not changed.

Crypto skeptics aren't going to change their minds, even though bitcoin is expanding. For instance, the well-known investor Peter Schiff still maintains that bitcoin is nothing more than a collector's item and that it has never recovered from the last crash. Naturally, Mr. Schiff is referring to coin values between $60,000 and $70,000. Bitcoin's recent price spike matches the definition of "local," and its price may increase locally. The CEO of Euro Pacific Capital also pointed out that while financial markets will eventually rebound and instruments will start to rise again, bitcoin will not. Schiff asserts that whenever bitcoin prices start to rise somewhat, collectors will start selling their holdings since the bitcoin bubble has already burst.

By the way, Jim Cramer, another skeptic of cryptocurrency, recently suggested that everyone sell their bitcoins as soon as their value increases by at least a little. According to Mr. Cramer, there will be no market recovery, so purchase deals should be terminated at a loss to prevent the loss of all investments. Naturally, many immediately comment, like Changpeng Zhao (the CEO of Binance), that bitcoin will continue to increase and that its collapse is improbable. But we want to point out that Mr. Zhao is someone who cares about the expansion of the entire bitcoin sector. Naturally, he will only ever forecast an increase.

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In turn, we can claim that recent developments have indeed contributed to bitcoin's growth. One only needs to keep in mind that the cryptocurrency started to increase precisely on the day that the United States published its most recent inflation report, which saw a sharp decline to 6.5% and, along with it, the likelihood that the Fed would tighten monetary policy by 0.5% at its upcoming meeting. Bitcoin might therefore feel better in 2024 than it did in 2022, but it is unlikely that it will wait for a supportive fundamental background.

The drop to $12,426 is currently being postponed because "bitcoin" quotes have surpassed the $18,500 threshold in the last 24 hours. The cryptocurrency can currently reach a price of $24,350, but it is not even guaranteed that it will reach this level. The data on US inflation is currently the only growth factor for "bitcoin." How long will this be the sole basis on which the market purchases bitcoin? It can theoretically take a while, but in reality, it's too soon to talk about the start of an upward trend. It can still increase in worth by a few thousand dollars, though.

Paolo Greco,
Analytical expert of InstaForex
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