Compass Investments

Crypto vs. Dollar

📌 Why a significant drop in bitcoin’s value does not seem too likely

The recent decline in the value of digital assets has raised alarm bells about a possible market crash, but macro-strategist Lyn Alden believes that the current correction does not resemble the euphoric peak that usually precedes a massive sell-off. Key Takeaways: Alden believes that bitcoins decline does not show signs of a typical cycle ending. . Bitcoin

– The recent decline in the value of digital assets has raised alarm bells about a possible market crash, but macro-strategist Lyn Alden believes that the current correction does not resemble the euphoric peak that usually precedes a massive sell-off. Key Takeaways: Alden believes that bitcoin’s decline does not show signs of a typical cycle ending.

She believes that bitcoin is currently more influenced by macroeconomic factors than the halving cycle.

Her prediction is for a smooth increase in value, not a collapse, with an expected $100K by 2026.

She sees nothing in current sentiment to suggest that the bull cycle has reached its natural limit.

In a conversation on the What Bitcoin Did podcast, Alden noted that bitcoin’s momentum is driven less by the halving cycle and more by general global trends: liquidity flows, risk appetite and institutional acceptance. As a result, she believes market cycles no longer follow a predictable four-year pattern and may take longer than traders think.

Her stance diverges significantly from the more gloomy predictions. Sigma Capital CEO Vineet Budkie has previously warned of a possible 65-70% decline in bitcoin over the next two years, arguing that the current drop is the start of a deeper structural adjustment rather than a temporary pause. As a result, the market is split, with neither side having enough arguments to clearly prove their case.

Bitcoin’s volatility continues to reflect this ambiguity. On Oct. 5, the asset peaked at $125,100, then fell to $80,700 before recovering slightly to $85,710. Over the past 30 days, the price has slipped more than 22% , disappointing traders who expected a breakout in the fourth quarter and even new highs, amid optimistic forecasts such as Arthur Hayes’ prediction of a rise to $250,000.

Alden argues against extremes – both excessive optimism and panic fear, emphasizing that markets rarely lead to the extremes that imagination paints. In her view, one of the biggest mistakes among traders is the belief that a parabolic rise is mandatory in a bull market. She cautioned that profit taking, not volatility, is one of the biggest psychological risks in investing.

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