Standard Chartered Lowers Bitcoin Forecast: Predicts Price Dive To $50,000 Before Rebound

Overview

Standard Chartered has revised its long-term Bitcoin forecast for the second time in under three months, indicating a bearish outlook for the cryptocurrency market. The bank now predicts that Bitcoin could decline to $50,000 before experiencing a potential recovery, as it currently consolidates below the $70,000 threshold.

Bitcoin Forecast Revision

In a recent note, Geoff Kendrick, the head of digital assets research at Standard Chartered, announced a revised target for Bitcoin, now set at $100,000 by the end of 2026. This new estimate represents a significant decrease from the previous projection of $150,000. The adjustment follows an earlier downgrade that occurred in December, when the bank had initially set a much higher target of $300,000.

The rationale behind this cautious stance is attributed to a combination of deteriorating macroeconomic conditions and changing investor sentiment, particularly in light of the recent downturn in the cryptocurrency market. Bitcoin has witnessed a decline of over 40% from its peak in October, with current trading prices hovering around $67,160. Additionally, the US Bitcoin exchange-traded funds (ETFs) sector has seen substantial net outflows, amounting to nearly $8 billion.

Kendrick pointed out that slowing economic momentum in the United States and diminished expectations for rate cuts by the Federal Reserve have adversely affected digital assets. Specifically, the reduction in ETF holdings has removed a critical source of demand that previously supported price rallies. The prevailing interest-rate environment remains a key concern, as the market has adjusted its expectations regarding the timing of potential Federal Reserve easing, with projections indicating that any forthcoming rate cuts may occur later than previously anticipated.

Furthermore, uncertainty regarding future leadership within the Federal Reserve has added to the cautious sentiment surrounding Bitcoin. Standard Chartered has warned that the combination of worsening macroeconomic conditions and the risk of further investor capitulation could continue to exert downward pressure on Bitcoin prices in the near term.

Ethereum Outlook

In addition to its Bitcoin forecast, Standard Chartered has also revised its outlook for Ethereum. The bank has lowered its 2026 price target for Ethereum to $4,000, down from a previous estimate of $7,500. Analysts expect that Ether may decline to around $1,400 before potentially recovering to the revised target.

Despite these revisions, Kendrick noted that the current downturn in the cryptocurrency market appears more orderly compared to previous cycles. He emphasized that on-chain activity data indicates continued improvement, suggesting that the underlying network usage remains robust. Notably, the market has not faced the high-profile platform failures that characterized the 2022 cycle, which included the collapses of Terra/Luna and FTX, leading to widespread contagion.

From author

The adjustments made by Standard Chartered reflect a broader trend of caution within the cryptocurrency market. As macroeconomic conditions evolve and investor behavior shifts, it becomes increasingly important for market participants to stay informed about the potential implications of these changes on digital asset valuations. The bank’s insights provide a glimpse into the challenges and opportunities that lie ahead for Bitcoin and Ethereum.

Impact on the crypto market

• Standard Chartered’s lowered Bitcoin forecast could influence investor sentiment and behavior in the short term.
• The significant reduction in the price target may lead to increased caution among traders and institutional investors.
• The ongoing decline in ETF holdings may further exacerbate the downward pressure on Bitcoin prices.
• The macroeconomic environment, including Federal Reserve policies, will continue to play a pivotal role in shaping market dynamics.
• Ethereum’s revised outlook highlights the interconnectedness of major cryptocurrencies and their susceptibility to broader market trends.