After the conflict between Russia and Ukraine caused the price of BTC to drop more than 10% and, the next day, to rise more than 11%, analysts in the crypto market have again punctuated the optimism with cryptocurrencies.
In an interview with Yahoo Finance, the chief investment officer of Bitwise Asset Management said that the current value of BTC is temporary and that it will not go below $50,000 in the second half of the year.
“It’s always uncomfortable when the market goes down. But I think we’re really gearing up for an extraordinarily strong second half.”
According to Hougan, the fall in cryptocurrencies is caused by a mix of problems involving taxes, regulation, conflicts, among others.
“The current downturn is being driven by three things that will resolve themselves. One is the market’s broad shift to a risk-free market that is bringing down all types of risky assets, cryptocurrencies among them. I think we are on the right path to adjust to this new reality.”
BTC will start to rise in the second half
Also according to Hougan, the second factor holding back the rise in cryptocurrencies is Biden’s executive order on cryptocurrencies that will be released soon. And third, he points to US tax season. At this time, many investors sell their cryptocurrencies to pay the tax to the government.
“I think when we get past that, it will be a relief,” he said.
Furthermore, Hougan stated that BTC could reach new highs due to positive developments in the market.
“I wouldn’t be surprised to see Bitcoin challenge and even surpass previous records. But for that, things need to follow positive lines.”
As examples of positive things, he cited: approval of a BTC ETF; reasonable regulatory results in Washington; and broader positive trends in terms of institutional cryptocurrency adoption.