Bitcoin Could Hit Record High If This Happens in the US: Grayscale

Grayscale Investments, a prominent digital asset management firm, has issued a bullish forecast for Bitcoin, suggesting that the world’s largest cryptocurrency could potentially reach a new all-time high later this year. This optimistic outlook is contingent upon the U.S. economy successfully navigating a soft landing.

Grayscale Predicts Bitcoin Rally

In a recent research report, Grayscale analysts expressed confidence in the U.S. economy’s ability to avoid a recession. They also highlighted that the evolving regulatory landscape for cryptocurrencies in the United States could mitigate downside risks for Bitcoin and other digital assets.

The firm emphasizes that the potential for substantial losses in a weaker economic environment is likely to be more limited compared to previous market cycles. This is attributed to the sustained demand for Bitcoin-backed exchange-traded products (ETPs) and the relatively subdued performance of altcoins.

Factors Influencing Bitcoin’s Future

Grayscale acknowledges that the cryptocurrency market’s trajectory will be significantly influenced by upcoming macroeconomic indicators and central bank policies. Key events such as the Federal Reserve’s September meeting and the Jackson Hole Symposium will play a crucial role in shaping market sentiment.

Despite economic uncertainties, Grayscale maintains a bullish stance on Bitcoin’s long-term investment prospects. The firm contends that even an economic downturn could bolster Bitcoin’s appeal, particularly in light of the current “undisciplined” monetary and fiscal policies.

Ethereum Underperforms Bitcoin During Market Drop

The recent market downturn, triggered by a disappointing U.S. employment report, had a more pronounced impact on Ethereum compared to Bitcoin. While both cryptocurrencies experienced declines, Ethereum’s price drop was more substantial.

Grayscale attributes Ethereum’s underperformance to the liquidation of substantial long positions in perpetual futures, which had accumulated in anticipation of the SEC’s approval of spot Ethereum ETPs. Additionally, selling pressure from significant holders like Jump Crypto and Paradigm contributed to Ethereum’s price decline.

As of now, Ethereum is trading at $2,634.10, down 16.5% over the past week. Bitcoin, on the other hand, has shown relative strength, currently priced at $60,781, with a 5% decline over the same period.