Bitcoin Price Outlook: Standard Chartered Expects Extended Drop To $50,000

Bitcoin’s price plunge below the $60,000 technical region could be the beginning of more pain for investors. British investment bank Standard Chartered said that the world’s largest and oldest cryptocurrency could fall as far as $50,000. Standard Chartered posited that a cocktail of crypto-specific tailwinds and macro factors could Trigger the Move lower. 

Bitcoin Has More Room To Fall

Bitcoin has risen nearly 50% in 2024 thanks to the U.S.-listed spot BTC exchange-traded funds (ETFs). However, prices have languished as the appetite for these new investment products withers. The maiden cryptocurrency slumped to sub-$57K today—the lowest level since the end of February. Standard Chartered sees more weakness in the near term.

In a May 1 note, Geoffrey Kendrick, the head of the bank’s forex and digital assets research, observed that “the broader macro backdrop has deteriorated for assets like crypto that thrive on liquidity.”

“The driver seems to be a combination of crypto-specific and broader macro,” the banking executive added, noting that Bitcoin’s dive below $60,000 has now reopened a path to the $50,000-$52,000 range.

In March, Standard Chartered forecasted that BTC would be valued at $150,000 per coin by the end of 2024. Bitcoin had been on a spectacular bull rally following the January greenlighting of nearly a dozen Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC). New money flooded the market as investors with no exposure to cryptocurrencies could now acquire shares that track the price of Bitcoin through brokerage accounts. 

The British bank pointed out that there have now been five straight days of bleeding from the BTC ETFs, and the top crypto is currently trading below the average ETF purchase price of around $58K.

“This means that more than half of the spot ETF positions are underwater, so the risk of liquidation for some of them must be considered as well,” Kendrick opined.

Regarding Hong Kong spot Bitcoin ETFs, Kendrick says their debut was negatively reported, as the focus was on the turnover volume of $11 million “rather than the net asset position of the new ETFs, which was pretty good.”

Meanwhile, the Federal Reserve has left its interest rates unchanged until it has greater confidence inflation is moving “sustainably” towards 2%. This decision is bound to scare investors away from “risk-on” assets such as Bitcoin.

Standard Chartered suggests that a potential re-entry into Bitcoin could be considered in the $50K to $52K range, especially if upcoming US Consumer Price Index (CPI) data is “friendly,” likely alleviating some macroeconomic pressures.

Despite setting a new historic high in March, the Bitcoin price currently stands at $58,536 after tumbling 7% in the last seven days.