Bitcoin Faces Price Drop to $65K Amid Central Bank Liquidity Boost, Analysts Predict Imminent Rally

Bitcoin’s price saw a 7% decline from $88,060 on March 26 to $82,036 on March 29, resulting in $158 million in long liquidations. This drop worried bulls as gold hit a record high, challenging Bitcoin’s “digital gold” narrative. However, experts believe a Bitcoin rally is imminent due to governments taking steps to prevent an economic crisis. The ongoing global trade war and US spending cuts are seen as temporary setbacks, with hopes of additional liquidity entering the markets to boost risk-on assets, positioning Bitcoin well for this macroeconomic shift. Mihaimihale, a user on the X social platform, emphasized the need for tax cuts and lower interest rates to stimulate the economy. Gold reached $3,087 on March 28, while the US dollar weakened against other currencies. Net outflows of $93 million from spot Bitcoin ETFs on March 28 also impacted sentiment. The market predicts a 50% chance of the US Federal Reserve cutting interest rates to 4% or lower by July 30. Alexandre Vasarhelyi of B2V Crypto noted that recent announcements, such as the US strategic Bitcoin reserve executive order, indicate progress in adoption. Real-world asset (RWA) tokenization is promising, but its impact is limited compared to the bond market. Despite Bitcoin’s recent performance, Vasarhelyi believes the story is about early-stage growth. Experienced traders expect a stock market correction, but anticipate a decline in policy uncertainty by April to reduce recession risks. The US administration softening its stance on tariffs could stabilize investor sentiment. Market volatility persists as economic conditions evolve. The recent Bitcoin correction is attributed to recession fears and tariff wars, with central banks expected to implement expansionist measures, creating a favorable environment for assets like Bitcoin.

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