Daniel Yan, one of the co-founders of Matrixport, issued a cautionary statement this week, highlighting concerning signs of euphoria and overheating in the Bitcoin market. He suggests that a correction of approximately 15% might be on the horizon in the upcoming weeks.
Yan’s remarks come at a time when Bitcoin surged beyond $64,000, marking its first climb to such heights since 2021. This surge has stirred excitement among investors, a sentiment echoed by the Crypto Fear & Greed Index, which currently sits at 85, indicating a state of extreme greed in the market.
The recent uptick in Bitcoin’s price coincides with the approval of several spot Bitcoin ETFs by the U.S. Securities and Exchange Commission in January.
Yan highlights the month of March as potentially challenging from a macroeconomic standpoint. Events like a Federal Reserve meeting, the Bitcoin halving, and Ethereum’s Dencun upgrade could introduce uncertainty and volatility into the markets.
Echoing a similar tone of caution, other analysts such as Arthur Hayes, Co-Founder of BitMEX, express concerns. Hayes anticipates that Bitcoin could dip below $35,000 due to various global macroeconomic and political risks.
Factors such as Federal Reserve policies, inflation rates, and the 2024 U.S. presidential election are expected to have a negative impact on assets like cryptocurrencies in the months ahead.
