The head of digital asset research at global investment giant, VanEck, Matthew Siegel, has predicted that Bitcoin will see large fluctuations in its price over the next year.
Mining bankruptcies bring a fall
Siegel expressed the estimate that this trend will start with a drop in the price of Bitcoin in the first quarter of 2023, reaching up to 10-12 thousand dollars.
In fact, Siegel pointed out that miners are not making a profit in this period of time, and estimated that bankruptcies will occur as far as the Bitcoin mining industry is concerned, which will cause a noticeable drop in its price.
“Bitcoin will be tested at $10,000 – $12,000 in the first quarter of 2023 amid a wave of bankruptcies in the miners. This development will mark the bottom of the “winter” of cryptocurrencies. With Bitcoin mining largely being unprofitable, given recent higher electricity prices and lower Bitcoin prices, we predict that many miners will restructure or merge,” Siegel said.
The Global Digital Asset Mining Index, MVIS, tracks the performance of companies that generate at least half of their revenue from digital asset mining or from activities related to the cryptocurrency mining ecosystem.
The optimistic forecast
Moving on to the optimistic forecast, VanEck’s head of digital asset research highlights that Bitcoin could reach $30,000 by July next year as inflation will fall and this development will bring an easing of monetary and fiscal policies.
“If our recession expectations are realized, the Federal Reserve will likely stop raising interest rates amid easing inflation at a time when money printing and government budget deficits continue. Just the lack of bad news, especially for cryptocurrencies, under this scenario could cause the price of Bitcoin to climb back up to $30,000,” Siegel said.