Bitcoin's Current Position and Market Analysis
On the last day of the week, Bitcoin hovers around $96,000 as Tom Lee identifies the root cause of its decline. He also reveals when he anticipates the market to start its upward trend. Lee, a well-known figure in the cryptocurrency space and head of a major Ethereum treasury company, sheds light on these pressing questions: What is causing the cryptocurrency market to decline, and when will the rise begin?
The Cause of Cryptocurrency Decline
Amidst the stock market volatility, cryptocurrencies have suffered painful losses. As BTC dropped from $102,800, investors grew concerned about further downturns in the 1.5-year rising trend. However, Tom Lee, a veteran in the cryptocurrency markets, remains optimistic about the future.
According to Tom Lee, the primary cause of the cryptocurrency decline is a gap in the balance sheets of one or more market makers. Some institutional entities, seizing this opportunity, are deliberately pushing BTC downward to trigger liquidations. Lee considers this a short-term issue.
“In my view, the weakness in cryptocurrencies has all the signs. There is a major ‘gap’ in the balance sheets of one (or two) market makers, posing a liquidation risk. Sharks striving to trigger liquidation have pulled the markets down. Is this painful? Yes, it is painful but also short-term.”
When Will Cryptocurrencies Rise?
BitMine, the largest Ethereum (ETH) reserve company, has amassed billions of dollars in ETH through equity issuance. As president, Lee has substantial reasons to anticipate an upward shift in cryptocurrencies. It is important to consider his forecast within this context and approach it cautiously.
Tom Lee reiterated his view that Wall Street is continuing its movement towards an ETH super cycle. Indeed, many banks, financial companies, and asset managers are progressing in their integrations with cryptocurrencies. Moreover, by 2026, as Quantitative Easing (QE) becomes more perceptible and interest rate cuts proceed, cryptocurrencies will gain the atmosphere they need along with all other risk markets.
So, when is the rise expected to begin? It is anticipated to start within 6-8 weeks after Thanksgiving on November 27. This implies that by mid to late January, the conditions will be significantly better than they are now.