In the latest episode of Cointelegraph’s “The Market Report,” analyst Marcel Pechman delves into the factors that suggest Bitcoin’s price could reach $22,000. The recent legal victory of Grayscale Investment against the United States Securities and Exchange Commission (SEC) on August 29, along with the delay of multiple spot Bitcoin exchange-traded fund applications, has led to worsening investor sentiment.
However, there are several bearish factors to consider. The SEC has filed multiple lawsuits against Binance and Coinbase, and there is a possibility of an indictment from the U.S. Department of Justice for facilitating money laundering and trades from Russian entities. Moreover, U.S. inflation has decreased to 3.2%, and the U.S. Federal Reserve is reducing liquidity in the markets.
Pechman also explores BitMEX founder Arthur Hayes’s claim that the Bitcoin bull market began in March. Hayes points to the fallout of Silicon Valley Bank and the subsequent intervention by the U.S. Treasury Department as significant turning points for the cryptocurrency market.
While Pechman agrees with Hayes, he raises concerns about the U.S. Dollar Index which is currently at the same level it was six months ago. The index measures the value of the U.S. dollar against major foreign currencies like the euro and the Swiss franc. Pechman explains that investors have recognized that other countries would likely experience economic collapse before the United States in the event of a global recession.
Ultimately, Pechman believes that the Federal Reserve is not concerned about potential economic turmoil if it means rescuing the banks. U.S. Treasurys and the U.S. dollar are still considered the safest options in such a scenario.
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Overall, Bitcoin’s potential to reach $22,000 has been influenced by Grayscale Investment’s legal victory, the delay of Bitcoin exchange-traded fund applications, multiple lawsuits against Binance and Coinbase, decreasing U.S. inflation, and the Federal Reserve’s liquidity reduction. Additionally, Arthur Hayes’s claim regarding the Bitcoin bull market start in March and concerns about the U.S. Dollar Index contribute to the analysis. Despite potential economic turmoil, the Federal Reserve considers U.S. Treasurys and the U.S. dollar as safe options.