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Bitcoin's Bearish Stance Persists Amidst Halving Hopes and ETF Expectations: Expert Analysis

Jack Evans
Oct 15, 2023 at 12:57 pm

Popularly known as DataDash on YouTube, cryptocurrency analyst Nicholas Merton has cast a shadow of doubt over Bitcoin's immediate prospects, even as the crypto community buzzes with anticipation for the upcoming halving and the potential approval of a Bitcoin ETF. In a recent video, Merton laid out his reasons for believing that Bitcoin is unlikely to embark on a new bull market in the near future.

First, he challenged the widespread optimism surrounding a prospective SEC-approved Bitcoin ETF. Contrary to popular opinion, Merton argues that such an approval might not unleash the tidal wave of new demand many expect. To support his claim, he points to the ongoing discount on the Grayscale Bitcoin Trust (GBTC), indicating that institutional interest may not surge even if an ETF becomes accessible.

Merton then delved into the diminishing impact of Bitcoin's halving events. He suggested that, with time, the reduction in new supply triggered by the upcoming halving would become relatively insignificant when compared to Bitcoin's growing market capitalization. This perspective contrasts sharply with the significant effects observed after previous halving events.

The analyst also scrutinized the current macroeconomic environment, pointing to factors such as rising interest rates, a strengthening dollar, and the looming threat of recession. In such an atmosphere, risky assets like Bitcoin seem less appealing. In Merton's assessment, the Federal Reserve's reluctance to employ aggressive quantitative easing measures, as they have in past economic crises, further limits the potential upside for Bitcoin.

In conclusion, Merton envisions Bitcoin remaining rangebound and struggling to achieve new all-time highs over the next year unless there is a substantial shift in market dynamics. His advice to investors is simple but vital: exercise patience and wait for clearer signs of a market bottom before considering significant crypto investments.

As Bitcoin's future hangs in the balance, Nicholas Merton's contrarian perspective reminds us that navigating the crypto landscape demands more than just optimism; it requires a critical assessment of the evolving market forces and a strategic, patient approach to investment.

Read more: HKVAC Unveils New Cryptocurrency Index: Hedera, Maker, and Quant Join Top Five

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