While on CNBC’s Fast Money episode on August 22, 2019, Brian Kelly, CEO of crypto investment firm BKCM said Bitcoin has gotten a little ahead of itself. Also, he sees the top cryptocurrency dumping in price, in the short term, which will offer a generational buying opportunity.
Bitcoin Dumps by 27% From its Year-to-date High
As at press time, Bitcoin’s price is $10,107, which is a 3.35% decrement in the past 24 hours. The cryptocurrency has also struggled to maintain its foothold at the $10,000 price level for almost three weeks now. In addition, Bitcoin has sunk by 27.15% from its year-to-date high of $13,796.
Brian Kelly, on the other hand, believes Bitcoin will decline even further because the fundamentals did not support its spike to the $13,000 zone. Similarly, the dump in price will be comparable to that of December 2018 where Bitcoin had tanked as low as $3,400. When that happens, Kelly said it would present a generational buying opportunity.
Bitcoin’s Active Daily Addresses Decline In Contrast with Price
Explaining why he thinks Bitcoin will retrace in the short term, Kelly said Bitcoin’s active daily addresses have been declining since the end of June and July this year. On the contrary, Bitcoin’s price was surging while the decline occurred. Also, the CEO remarked that the 30-day moving average also shows that Bitcoin could tank even lower.
When asked what the signs of a generational buy opportunity are, Kelly said it depends on what the active daily addresses are depicting. According to him, if the activity on Bitcoin’s network increases whereas the asset’s price is crashing, then it shows a bull run is ahead. Also, if the market sentiment changes to “Bitcoin is dead”, then that’s the time he feels the crypto asset will spring up once again.
Bitcoin’s Dump in Price is Not a Certainty
Nonetheless, Kelly was quick to point out that his forecast might not be the case. The latter, he attributed to the fact that a lot of institutional investors are moving to derivatives. As such, relying majorly on the active daily addresses to determine where Bitcoin is headed, might be misleading. He added that things might have changed this time around.
Like Brian Kelly, several people in the crypto community are also bearish about Bitcoin in the short term. They have opined that Bitcoin will retrace to the $8,000 level soon. Others like WelsonTrader have remarked that Bitcoin will decline while altcoins, which have been stable or dipping most of the year, will finally take a significant leap in price.