The price of Bitcoin once approached six figures, but after rapidly nearing the $100,000 mark last week, the trading price of each Bitcoin is now below $94,000.
According to British multinational bank Standard Chartered, Bitcoin still has room to fall further.
The company's digital asset researcher Geoff Kendrick wrote on Tuesday that more bumps are ahead, with BTC expected to drop to a low of $88,700. What is the reason?
He wrote: "I believe the catalyst for yesterday’s (Bitcoin price drop) was the reduction of the U.S. Treasury yield premium after Bessent (was appointed Treasury Secretary)." After Donald Trump nominated Scott Bessent as U.S. Treasury Secretary, U.S. Treasury bonds rose, and yields on bonds with maturities of 5 to 30 years fell by more than 10 basis points.
Kendrick added that in the short term, the momentum of Bitcoin may slow down because "one of the core uses of Bitcoin is to hedge against (traditional financial) issues related to the banking sector or the Treasury."
Hedge fund manager Bessent is viewed as a fiscal conservative on Wall Street, which could mean more prudent monetary policy—especially regarding tariffs. Donald Trump had promised to adopt aggressive tariff policies, imposing taxes on imported goods. Economists say that since tariffs often lead to heightened inflation, there has been a pullback in U.S. Treasury bonds.
However, many market analysts expect Bessent to tame Trump's policies, leading to a rebound in Treasury bonds.
By market capitalization, the largest digital assets are often viewed as tools to hedge against poor government monetary policy and inflation. But with U.S. Treasury bonds rising, investors—at least for now—are satisfied with what they see in traditional financial markets.
After Donald Trump shocked the election victory on November 5, Bitcoin began to surge dramatically, setting a record high of $99,645 last week. This sharply contrasts with the situation on election night when Bitcoin's trading price was below $70,000 amid uncertainty about Trump's victory.
This former Republican president won the popular vote and swept all swing states. Now, investors are optimistic: this real estate mogul has promised deregulation, tax cuts, and support for the digital asset industry.
However, Bitcoin failed to break through the $100,000 threshold and has rapidly declined this week.
However, Kendrick added that in the long term, it will continue to rise. He predicts that by the end of this year, Bitcoin will reach $125,000 per coin, and the target of $200,000 by the end of 2025 remains very achievable.
Pantera Capital Management CEO Dan Morehead predicts that Bitcoin's price could reach $700,000 by 2028, as institutional investors, regulators, and legislators become more accepting of digital assets.
"According to historical trends, due to the election of pro-cryptocurrency President Donald Trump and the presence of a digital asset-friendly majority in the U.S. Congress, Bitcoin's price could reach $740,000 by April 2028."
Morehead believes that currently only 5% of financial wealth is invested in blockchain-related assets, which means there is significant room for the price of Bitcoin to grow.
"Even after 11 years, Bitcoin continues to surge like a watermelon seed," Morehead wrote. "The regulatory headwinds faced by blockchain over the past 15 years are now turning into tailwinds."
This executive's optimistic forecast comes alongside good news for the hedge fund: the Bitcoin fund launched by Pantera Capital in July 2013 has generated over 131,000% returns over the past 11 years (excluding fees and expenses).
These massive returns are due to the fact that the value of Bitcoin held by this hedge fund has increased more than 1000 times since it was first purchased over a decade ago at a price of $74 each.
According to data from CoinGecko, at the time of writing, BTC's trading price is around $96,300.
Despite the astonishing growth of Bitcoin, Morehead believes that this leading cryptocurrency is still in the "early stages" and has a lot of room for growth.
