Digital assets have suffered under macro headwinds as economic uncertainty looms in the United States. The crypto industry has faced rough times since the year began following a macro-driven sell-off. Bitcoin could break below $90k, and once it does, a Standard Chartered report suggests a further 10% retracement is probable.
The year started rough for crypto assets. Since January 1st, digital assets have bled following economic uncertainty fueled by Trump’s return to the White House and fiscal policies from the Federal Reserve Bank.Â
Standard Chartered Bank cautions a 10% dip once BTC falls below $90k
🚨 Bitcoin Takes a Breather: StanChart Sees Sub-$90k as a Golden Chance $BTC is under fire from macro pressures, and analysts at Standard Chartered say a dip below the $90,000 mark could unlock a juicy medium-term buying window. The head of the bank’s digital assets research,… pic.twitter.com/VvD0jqgqm3
— Blockman (@blockmandev) January 15, 2025
A report from Standard Chartered, a corporate and investment banking and treasury service provider, suggests that the crypto meltdown may continue. According to the report, the digital asset downturn results from the Federal Reserve adopting a more hawkish stance in mid-December.Â
According to Jerom Powel, the chair of the Federal Open Market Committee (FOMC), Fed officials will take more cautious steps going forward regarding the ongoing rate cuts, citing risks of rising inflation.Â
Furthermore, the U.S. job market again defied an anticipated slowdown, with firms adding more than a quarter of a million jobs in the last full month of Joe Biden’s reign as the U.S. president. The data left Fed policymakers puzzled over the need for further interest rate cuts since the job market indicates a strong, booming U.S. economy.
The bank highlighted that crypto investors who invested in Bitcoin after the U.S. presidential elections on November 5th are now breaking even. The report detailed that there exists a risk that Bitcoin could collapse further as these investors panic and liquidate their holdings to avoid holding losses.Â
The report included investors who took Bitcoin exposure through exchange-traded funds (ETFs) and those who invested in software giant Microstrategy. Standard Chartered’s head of digital assets research, Geoff Kendrick, wrote that the risk of mark-to-market pain is piling up.Â
U.S. spot ETFs have experienced negative flows since January 8th
The current crypto meltdown has trickled down on U.S. spot Bitcoin ETFs. According to data from ETF tracking website Sosovalue, the Funds recorded outflows worth $209.82 million, marking a streak of negative flows that began on January 8th. BlackRock’s IBIT recorded the largest negative flows among the listed ETFs, worth $219.48 million. The ETF still has the most net assets under management, valued at $53.46 billion.
The Funds witnessed negative flows worth $582.90 million on January 8th, $149.35 million on January 10th, and $284.19 million on January 13th. As of January 15th, the ETFs still held considerable assets totaling $108.98 billion.Â
The bank also noted that if Bitcoin falls below $90k, the asset will likely dip by more than 10% toward the $80k level. According to Standard Chartered, the rest of the crypto market will crumble following Bitcoin’s dip. The banking institution advised investors looking for exposure to the digital asset to join the bandwagon once the retracement is over.
Standard Chartered predicts Bitcoin will hit 200k before the year ends
Standard Chartered still believed Bitcoin would hit $200K by the end of 2025, citing increased institutional interests in the assets as well as new reforms promised by the incoming Trump administration.
Despite Trump’s proposed tariffs causing uncertainty in the markets, experts such as Alice Liu, Research Lead at CoinMarketCap, believe that the crypto market will pump once Trump assumes office after his inauguration on January 20th.Â
Trump is reportedly expected to sign a crypto executive order on his first day in office, a move that could fuel a crypto pump. Rumors surfing the internet suggest that the executive order may involve announcing a crypto council or lifting restrictions hindering banking institutions from facilitating crypto activities.
