Bitcoin has dropped sharply as traders scramble to get ahead of that could be a massive price shock this week.
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The bitcoin price has fallen toward $75,000 per bitcoin, down almost 10% from last week’s peak of nearly $83,000, as a tiny cryptocurrency branded “like bitcoin in 2013” adds to a 1,000% price surge.
Now, with Wall Street going into “full panic mode,” analysts are warning bitcoin is “on the brink” of a price crash and one legendary trader predicts 2008-style panic could be about to hit markets.
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The bitcoin price has struggled over the last year, with many bitcoin price and crypto market watchers fearing a bitcoin crash.
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“Bitcoin is on the brink of a knockdown,” Alex Kuptsikevich, FxPro chief market analyst, said in emailed comments.
“The market is now approaching a point at which the bulls’ strength will be tested. A move lower would technically break the uptrend that has been in place since early April, and dash hopes of an end to the bear market that has been ongoing since October.”
Kuptsikevich warned that if the $76,000 per bitcoin level is breached, it could mean bitcoin falls sharply toward $60,000.
“Bitcoin appears to be in the bears’ grip,” Kuptsikevich said.
“Repeated failures to break above the 200-day moving average have sent the market into a downtrend. This corrective pullback has knocked the price out of the growth channel of the past month and a half. However, the uptrend is not formally considered broken until the price falls below previous local lows. And right now, the market is teetering on the edge.”
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The bitcoin price has struggled to regain momentum, with a bitcoin price rally stalling over the weekend.
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Meanwhile, growing adoption of artificial intelligence tools by companies and subsequent layoffs has been predicted to send shockwaves through the economy.
Crypto trader Arthur Hayes has warned AI could trigger 2008-style panic as job losses hit the economy, with Bureau of Labor Statistics data last week showing that several jobs expected to be impacted by artificial intelligence have seen heavy losses for a second year.
“In the short term there’s going to be some pain,” Hayes, a cofounder of the bitcoin and crypto derivatives pioneer BitMex who now runs the Maelstrom family office, told the Unchained podcast.
Hayes predicted the rapid growth of AI will mean “all mediocre knowledge workers are at risk of losing their job.”
As a result, “there is no other choice but to fall behind on consumer credit payments to banks. It’s game over for the fugazi fiat fractionalized banking system,” Hayes wrote in a blog post earlier this month.
AI “will destroy the financial system unless they print enough money. And so I believe that they’re always going to print enough money,” Hayes told Unchained, predicting such money printing will eventually send the bitcoin price sharply higher.