Standard Chartered analyst Geoff Kendrick stated in a Friday note that the crypto market has reached its lowest point following Bitcoin's recent drop to nearly $59,000. Kendrick, the investment bank's global head of digital asset research, described the decline as a 53% drawdown from Bitcoin's peak price of $126,000 in October and declared that 'winter is over.' The assessment comes as the crypto market has remained tepid in recent months, with developments including potential U.S.-Iran peace talks and SpaceX's $1.75 trillion IPO emerging as catalysts for reversal.
Bitcoin recently changed hands above $64,000, representing a 5% increase over the past week, according to CoinGecko. The total value of all cryptocurrencies tracked by the crypto data aggregator edged down to $2.277 trillion from $2.29 trillion over the same period.
Kendrick Identifies 53% Drawdown as Market Bottom
Kendrick wrote in his Friday note that Bitcoin's recent fall to nearly $59,000 marked crypto winter's most frigid conditions. The price level represents a 53% drawdown from the cryptocurrency's peak price of $126,000 in October, eight months ago. 'I think we have now seen the low in crypto asset prices,' he wrote. 'Winter is over.'
Standard Chartered issued a $100,000 price target for Bitcoin in February.
Geopolitical Developments and SpaceX IPO Act as Market Catalysts
Developments on Friday are shaping up as catalysts for the crypto market, Kendrick stated. He pointed to signs of a potential peace deal between the U.S. and Iran ahead of next week's G7 summit, as well as SpaceX's $1.75 trillion IPO.
President Trump announced on Thursday that a breakthrough could come this weekend, according to AP News. Trump has claimed numerous times that the U.S. and Iran are close to establishing an arrangement that would signal an end to the three-month conflict. 'If true, [it] may sound the end to higher oil prices,' Kendrick wrote.
West Texas Intermediate crude fell 1.5% on Friday to $86 per barrel, according to Trading Economics. On Myriad, a prediction market owned by Decrypt's parent company Dastan, traders grew confident that the U.S. oil benchmark will fall to $55 before $120.
Kendrick noted that since war in the Middle East began choking global oil supplies, surging energy costs have coaxed U.S. Treasury yields higher, punishing risk assets like crypto as guaranteed, risk-free government debt has become relatively attractive.
Kendrick argued that some of the selling likely stems from investors looking to hitch a ride on Elon Musk's rocket company, 'selling to free up cash to enter the IPO.'
Bitcoin ETFs Record $5 Billion Net Outflows Since Mid-May
Exchange-traded funds that track Bitcoin have seen some of the sharpest selling 'since inception' in recent weeks, Kendrick wrote. The Wall Street vehicles have posted roughly $5 billion in net outflows since mid-May, according to CoinGlass.
Analyst Outlines Three Confirmation Indicators for Turnaround
Kendrick stated that his call requires some signs of confirmation. That includes net inflows for Bitcoin ETFs on Friday, a continued decline in oil prices, and an announcement from Strategy on Monday that the Bitcoin-buying firm expanded its holdings.
FAQ
What price level did Bitcoin reach that Standard Chartered considers the market bottom?
Standard Chartered analyst Geoff Kendrick stated in a Friday note that Bitcoin's recent drop to nearly $59,000 marked the crypto market's lowest point. This level represents a 53% drawdown from Bitcoin's peak price of $126,000 in October.
Why does Kendrick believe geopolitical developments will impact crypto prices?
Kendrick pointed to potential U.S.-Iran peace talks ahead of next week's G7 summit as a catalyst. He noted that since war in the Middle East began choking global oil supplies, surging energy costs have pushed U.S. Treasury yields higher, making risk-free government debt relatively attractive compared to risk assets like crypto. A peace deal may end higher oil prices, potentially reversing this dynamic.
How much have Bitcoin ETFs lost in net outflows recently?
Bitcoin exchange-traded funds have posted roughly $5 billion in net outflows since mid-May, according to CoinGlass. Kendrick described this as some of the sharpest selling 'since inception' and suggested some selling may stem from investors freeing up cash to enter SpaceX's IPO.
