Michael Moro, CEO of trading firms Genesis Trading and Genesis Capital Trading predicts that the current price slump will continue towards the $3,000 support line.
These dark times are expected to continue for bitcoin as the CEO of Genesis Trading and Genesis Capital Trading, in conversation with CNBC on Friday (November 23rd) explained that he expects to see a continued downward trend, hitting a floor at $3,000.
“You really won’t find [the floor] until you kind of hit the 3K-flat level.” Moro told CNBC’s Squawk Box. He also stated that he does not believe the mid-3,000 level is a legitimate support and that the four-thousand mark has been tested twice already over the last week.
Advising Not to Buy the Dip
Moro, who is a veteran trader, said that investors are now ready to handle the slump, conceding that taking the long view was now the only position to take and advising not to buy the dip.
“This is about the fifth or sixth 75 percent-plus drawdown that we’ve seen in the 10-year history of Bitcoin.” Explained Moro. “And so if you have that [long-term] lens, I don’t believe institutional investors really ultimately care where the price of Bitcoin ends in 2018, simply because they’re looking at things three to five years out.”
Mining Might Be Worth It Again
As the crypto winter has set in, mining operations have in some places cut their losses. Operations in China have been reported to be selling mining rigs for just 5% of their value. Others have been selling mining hardware by the kilo.
Despite these rock bottom prices for mining hardware, it may not be the best idea however as CNBC also report that the cost of mining bitcoin only just breaks even at this point.
However, Moro was also pressed on his opinion on what this slump most likely means for mining. Moro speculated that the cost of mining would go down because hash rate has dropped.
Dotcom Bubble Burst
This market tanking has already been compared to the bursting of the dotcom bubble at the beginning of the 21st Century. Speaking with CNBC, Lou Kerner, a partner at venture capital firm CryptoOracle said that cryptos should have been viewed the same as tech companies like Amazon at the end of the 1990s.
“If you go back to the internet bubble, which is what a lot of us in crypto look at for direction, Amazon, arguably one of the greatest companies in the history of the mankind, was down over 95 percent over two years.”
(Disclaimer: All views expressed in this article are opinions and should not be treated as financial advice.)
Photo by David McBee from Pexels
Alex has been putting words on paper since he was old enough to hold a pen; when he bought his first bitcoin in January 2017, those words discovered their place within crypto as well. He holds a master’s degree in international relations from Leiden University in the Netherlands, and his special expertise lies in European cryptocurrency regulation.