Note that yesterday afternoon Bitcoin experienced a notable plunge to $19,000. The fall was a reaction to the announcement of data on the consumer price index or so-called inflation index in the United States. At 9.1 percent year-on-year, it was also the biggest year-on-year change since 1981. Meanwhile, the predicted inflation result was 8.8 per cent.

Here is Bitcoin’s hourly chart, highlighting the period when the inflation data was announced.

Bitcoin exchange rate hourly chart

A few hours later, however, the cryptocurrency regained ground and reached $20,435. Accordingly, there is quite strong interest in the coin at a rate below $20,000.

When will there be a new Bitcoin record

Demairos appeared on CNBC’s Squawk Box the day before, where she stated that Bitcoin is a “cyclical asset”. That is, the cryptocurrency constantly goes through cycles of growth, which are followed by a fall of an average of 80-90 percent from its peak. At the moment, BTC is 65-70 percent behind its high, so Demairos doesn’t rule out an even bigger downward correction.


Note that a funny story happened with CNBC yesterday, which also has to do with the inflation index in the USA. CNBC anchor Ran Neuner said that he expected the market to bounce after the inflation results were announced. The market ended up going the wrong way and Ran deleted the tweet. If anything, his "prediction" looked like this.


Ran Neuner’s deleted tweet

However, Bitcoin has strong support at the $20,000 line, with the cryptocurrency itself unlikely to fall below $14,000, the expert notes. Already by 2024, investors’ current worries will seem like something insignificant, as BTC will go up in that timeframe, Demairos is confident. Here’s her rejoinder.

In the next 24 months, we will see a new historical high on the Bitcoin chart.

CoinShares chief strategy officer Meltem Demairos

Today Bitcoin started the day around $20,035 – just above the aforementioned Demairos support. She herself admits that investors are unlikely to expect a quick rebound in the value of BTC in the near future, as there are “no necessary conditions” for that. Here’s another of her quotes.

We’ve definitely had a lot of liquidations and insolvencies of cryptocurrencies, which has really impacted the market. We’re talking about $10 billion, $20 billion, $30 billion in capital that “evaporated” in a very short period of time. We definitely expect more pain for technology stocks, the growth economy and crypto.

In other words, analysts are not yet betting on an end to the bearish trend for the coin niche. However, it is impossible to be truly sure of anything in the cryptocurrency industry, so this view should only be taken as one of the possible versions, not something definitive.

Bitcoin exchange rate

According to Cointelegraph’s sources, this bearish trend will be hard on many projects. In doing so, a significant portion of them will simply “die”, as has been the case with shares of technology companies in the stock market in the past.

There is a very large set of crypto-assets that I think will fall to zero as they don’t have any long-term prospects. We have seen something similar with tech stocks.

Meltem Demairos’ forecast is quite “fuzzy” on the timing and specifics of BTC market dynamics in the near term. This is not surprising, though: there is uncertainty in the crypto market and the macro economy as a whole right now, along with fear of an even bigger crisis. However, such periods of despair are always followed by new growth cycles.

Read also: A significant rise in Bitcoin is now considered highly unlikely. What's stopping the major cryptocurrency?

Unfortunately, the massive accumulation of cryptocurrencies by large institutional investors can be sabotaged by the fact that the industry lacks thoughtful regulation. John Cunliffe, Deputy Governor for Financial Stability at the Bank of England, has drawn attention to this point.

In a speech at the UK High Commission residence in Singapore, Cunliffe said regulators need to “get to work” on incorporating cryptocurrencies and blockchain into the existing regulatory framework, comparing crypto to “unreliable aircraft”.

He mentioned some of the events that led to the serious collapse of BTC. These include the collapse of crypto project Terra (LUNA), the loss of parity to the dollar of the UST steiblockchain and the bankruptcy filing by Three Arrows Capital. Here is the banker’s point of view.

The lesson we should not learn from all this is that ‘crypto’ is somehow ‘over’ and we don’t need to worry about it anymore. Cryptocurrencies offer the prospect of significant innovation and improvement in finance. But to be successful and sustainable, innovation must take place within a framework in which risk is managed. You can’t fly on unreliable planes for long.

In other words, the banker believes that crypto needs thoughtful regulation to make the most of innovation. In addition, he made it clear that the coin industry is no longer going anywhere, even though the price of Bitcoin has fallen so hard.

John Cunliffe, Deputy Governor for Financial Stability at the Bank of England


We believe the two-year benchmark is broadly in line with previous cryptocurrency market growth cycles, so such a prediction could indeed come true. Whatever the case may be, investors should not count on it unequivocally and should be prepared for anything. Still, anything can happen in the industry - and the pandemic in 2020 proved that.


What do you think about it? Share your thoughts in our Millionaire Crypto Chat. There we will discuss other important events that are affecting the blockchain world.