Grayscales Zach Pandl says Fed pause may mark Bitcoin bottom
Bitcoin has fallen more than 50% from its $125,000 cycle peak, but Grayscales Zach Pandl has argued that the cryptocurrency may have already reached its bottom if the Federal Reserve stops raising interest rates. Grayscale Research has presented two competing views of when the current Bitcoin bear market could end, with one based on the assets four-year cycle and the other tied to economic growth, real interest rates and Fed policy. Pandl, Grayscale‘s head of research, favors the second explanation because Bitcoin has increasingly behaved like a mature asset affected by the same macroeconomic forces that influence other major markets. Under that view, stable growth and an end to rate hikes could allow Bitcoin’s latest low to hold. Bitcoin is a macro asset and it trades with macro variables (eg growth and policy expectations) If the Fed doesnt hike $BTC may have already bottomed, even if the 4yr cycle framework implies longer bear market The cycle-based model offers a less favorable timeline. According to Grayscale, Bitcoin has historically reached a bottom about one year after its cycle peak and roughly two and a half years after each halving. Previous bear markets have also produced average drawdowns of around 80%. Following that pattern, Grayscales analysis indicates that
