Pantera Capital Explains Why Bitcoin Could Rise Soon
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Answer Pantera Capital Explains Why Bitcoin Could Rise Soon
Despite the recent turmoil in the cryptocurrency market, Pantera Capital predicted a rise in the price of Bitcoin in the following weeks.
According to investment firm Pantera Capital, Tax Day could be one of the factors that will push the price of Bitcoin higher.
In addition, the cryptocurrency industry may soon separate from the traditional financial markets and start trading independently, the same company added.
Light at the end of the tunnel:
The past several months for Bitcoin have been very bearish.
While many Bitcoin proponents expected to see it trading at $100,000 by the end of 2021, it ended the year at less than $50,000, and the start of the new year bore further declines.Read:Terra Buys $100 Million in AVAX Coins…Here’s Why!
February 24 was another negative trading day as the military conflict between Russia and Ukraine led to a significant drop in cryptocurrency prices.
In the past hours until the moment, the price of Bitcoin began to recover and corrected most of its losses, as it is currently trading at $39,400.
In its report, dubbed “The Next Mega Trade,” Pantera Capital explained the reasons why Bitcoin could soon resume its rally.
One is Tax Day, which this year falls on April 18.
The company stated that in 2013, 2017, 2020, and 2021, the price of Bitcoin rose significantly 35 days before the event.
However, each time the asset lost some of its gains on that day as investors were selling some of their holdings to cover taxes, which makes sense according to the company.
Many cryptocurrency traders are new to investing.
You can imagine someone buying as much bitcoin as possible.
Since it is the largest and oldest in the cryptocurrency market, the only way to raise funds to pay the tax bill is to sell some of it.
Prices usually drop on tax day.Read:Craig Wright’s lawyers are calling on websites to delete the Bitcoin white paper… Details here
The independence of the crypto market from the financial markets:
Pantera Capital touched on the Federal Reserve’s policies during the Corona pandemic, and the company described mass printing of fiat currencies, manipulating Treasuries, and mortgaging bonds as a clearly wrong combination.
The same company blamed the US central bank for rising inflation and economic turmoil within US borders.
She told Pantera Capital that a bubble would burst, and then the Fed would have to raise interest rates higher.
According to Dan Morehead, CEO of Pantera Capital:
This sounds like good news for the cryptocurrency world.
I have a strong conviction that markets really do get it wrong and that higher interest rates (which I think was very clear is going to happen and will continue) isn’t really bad for cryptocurrencies.Read:A technical flaw was discovered in the Ripple (XRP) blockchain … and the team is working to fix it
And for other asset classes, it’s actually great for crypto prices.
Next, Dan Morehead believes that the cryptocurrency industry will emerge as a financial space in its own right, which means that volatility in traditional money markets will no longer be a concern. He commented on this by saying:
We believe that in the coming weeks, the cryptocurrency will break away from the traditional markets and start trading on its own again.
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