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Bitcoin Could Reach $28,000 by End of 2002, Deutsche Bank Analysis Forecasts



Bitcoin Could Reach $28,000 by End of 2002, Deutsche Bank Analysis Forecasts

According to a Deutsche Bank research, Bitcoin might reach as high as $28,000 by the end of the year given how closely it has been trading with US markets.

Cryptocurrencies have been increasingly correlated to the Nasdaq 100 & S&P 500, Analysis States 

The greatest digital token in the world, Bitcoin, has fallen in value in 2022 due to a risk-off environment brought on by rate hikes and inflation worries. Marion Laboure and Galina Pozdnyakova’s analysis predicts a more than 30% increase from the coin’s trading level on Wednesday of roughly $20,000, albeit even at that price, the token is still selling for less than half of its November peak.

According to Laboure and Pozdnyakova, since November, there has been an increase in the correlation between cryptocurrencies and benchmarks like the S&P 500 and the tech-heavy Nasdaq 100. The S&P will return to January levels by year’s end, according to the bank’s strategists, and Bitcoin might follow.

Bitcoin Could Reach $28,000 by End of 2002, Deutsche Bank Analysis Forecasts

They claimed that, unlike gold, a reliable safe-haven asset, the digital currency is more like diamonds—a highly marketed item.

“By marketing an idea rather than a product, they built a solid foundation for the $72 billion-a-year diamond industry, which they have dominated for the last eighty years. What’s true for diamonds, is true for many goods and services, including Bitcoins,”  The Deutsche Bank analysts wrote

With losses of more than 50% this year, Bitcoin fell short of analysts’ and market-watchers’ expectations that it would prove to be a haven for investors. During the market crash, digital coins underperformed equities, bonds, and commodities because their prices were under pressure from the elimination of surplus liquidity by major central banks. On the other hand, gold fared significantly better over time.

Laboure and Pozdnyakova describe how De Beers, a significant participant in the diamond industry, was able to alter consumer perceptions about diamonds through its marketing initiatives.

The Deutsche Bank’s experts forecast that the United States will enter a recession in 2023 and have headline inflation that peaks in September at 9.1 percent; they have compared the current “global stagflation winds” to those of the 1970s when energy was the best-performing sector. The performance of bitcoin during a time of high inflation may be modest “unless it is becoming digital oil,” the bank added.

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