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Forex in this article
• Market surprises in 2023
• Declines in tech stocks accelerate bitcoin selling
• Gold becomes a safe haven again
Scenarios outlined by Standard Chartered Bank for 2023 include falling Bitcoin prices, falling oil prices, falling food prices and the impeachment of US President Joe Biden. The bank stresses that the “Financial Market Surprises in 2023” analysis is not about determining the likelihood of individual scenarios, but rather determining their impact on the market.
In one scenario, Bitcoin is following a broad tech downturn well beyond the 2022 losses. Standard Chartered Bank’s head of research Eric Robertsen sees returns plummeting along with tech stocks. Because even if the price decline is slowing, too much capital has been withdrawn: “More and more companies and crypto exchanges are facing insufficient liquidity, leading to further bankruptcies and a collapse in investor confidence. in digital assets.
Such an undervaluation of the crypto market and loss of investor confidence could lead to Bitcoin crashing again to around $5,000, analysts say. Given that Bitcoin is currently priced around $16,844, this would mean a price loss of around 70%. In 2022, Bitcoin has already fallen by more than 60% (as of December 26, 2022). Bitcoin is miles away from its all-time high of November 10, 2021 at $68,789.63. Since then, around $2 trillion has been withdrawn from the crypto market, which is why many experts are warning of an ongoing crypto winter, according to CNBC.
Where is the journey going for Bitcoin, Ethereum and Co. in 2023?
Well-known portfolio manager Mark Mobius also predicted that Bitcoin would fall to US$10,000 in an interview with CNBC. Because in times of rising interest rates, holding cryptocurrencies is not attractive. However, digital assets would not entirely disappear from the market, as they would always find new investors.
Meanwhile, venture capitalist Tim Draper is sticking with cybercurrencies despite the recent crypto crash and FTX bust. He shifts his bullish target for Bitcoin to $250,000 from late 2022 to mid-2023, citing the decentralization of digital assets and tapping into a new group of investors, namely women.
Gold as a safe haven?
Robertsen predicts that conversely, the price of gold could benefit from the decline in the price of crypto and rise by around 25% to reach $2,250 (as of December 26, 2022). Investors could find stability in “safe-haven gold” and flee to commodity investments due to e-currency and stock market volatility. “Gold’s rebound in 2023 will also be helped by the continued decline in stock markets and the correlation between stock and bond prices turning negative again,” the analyst continued.
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