Cross-currency scandal: bitcoin may end the year in the range of $65-72 thousand.

Bitcoin may end up in the range of $65-72 thousand by the end of the year, which is the average benchmark given by experts interviewed by Izvestia. So far, the crypto market is flying to the lower limit of this range: on November 13, the exchange rate was less than $69 thousand, losing about 7% per day and updating the minimum in almost three months. Among the reasons are the scandal surrounding former Nvidia CEO Jensen Huang, inflation in the United States and expectations of further tightening of the Fed's policy. The collapse was reinforced by transactions with borrowed money: during the day, exchanges forcibly closed positions for almost $ 1.5 billion. Whether bitcoin will stay above $65 thousand and when investors will be able to wait for a reversal is in our article.

Why is Bitcoin Falling

Bitcoin dropped below $69,000 on November 13, losing about 7% per day, according to CoinGecko data. The exchange rate has updated at least in almost three months.

One of the reasons for the sale was the scandal surrounding Nvidia co-founder Jensen Huang, said Kirill Lysenko, a leading analyst on sovereign and regional ratings at Expert RA. Nvidia announced the resignation of Jensen Huang from the posts of president, CEO and member of the Board of Directors on November 12. The media reported on the businessman's alleged extramarital affairs, including with Alice Huang, who was previously a top manager at Singapore's Megaspeed. The American authorities suspect this woman of working for Chinese intelligence.

Following the results of trading on November 12, Nvidia securities fell by 4.3%. Through exchange—traded funds and derivatives — contracts tied to the value of an asset - bitcoin has become part of common investment portfolios. Therefore, the upheavals in the technology sector are quickly reflected in the cryptocurrency exchange rate, explained Dmitry Marinichev, adviser to the Director General of the Agency for Strategic Initiatives.

The deeper reason for the decline is the expectation of a rate increase by the US Federal Reserve System (FRS), Kirill Lysenko added. The next meeting of the regulator will be held on December 8-9. According to the US Bureau of Labor Statistics, consumer prices rose by 0.4% in October over the month, while the surveyed economists had expected 0.3%.

Such inflation increases fears that the Fed will maintain a tight monetary policy for longer, the analyst explained. Under these conditions, investors are more attracted to dollar investments that bring interest income, such as deposits and bonds. By itself, owning bitcoin does not provide such payments, Kirill Lysenko emphasized.

The weakening in demand is also noticeable by the outflow from spot bitcoin ETFs, exchange-traded funds that directly buy cryptocurrencies, said Sergey Dzhurinsky, portfolio manager at Alfa Capital Management Company. From October 30 to November 12, withdrawals exceeded receipts on nine out of 10 trading days. The net outflow during this period was about $2.6 billion. The expert sees an additional reason for the sales in the redistribution of capital before the expected IPO of Anthropic, the first public offering of the company's shares.

The fall accelerates the forced closing of transactions with borrowed money, said Kirill Komalenkov, director of strategic communications at Bitbanker. According to CoinGlass on November 13, positions of about $1.4 billion were liquidated on the entire crypto market over the previous day, affecting about 173 thousand traders. The main part came from betting on growth. As the expert explained, when losses reduce the security of a transaction below the acceptable level, the exchange automatically closes it. Such forced sales reinforce the collapse.

The supply of bitcoins is also being increased by large miners, companies that mine cryptocurrency, said Guzel Protsenko, CEO of Alfa—Forex. According to her, they sell the accumulated coins to repay loans and build data centers for artificial intelligence projects.

The expert called the Binance hack, which the platform reported on October 30, another blow to investor confidence. The exchange said it would cover the losses at its own expense. Nevertheless, by November 2, the net outflow of client funds from it amounted to about $5.3 billion.

However, the current sale does not necessarily mean the beginning of a protracted crisis, says Alexey Petrov, managing director of Finbridge venture studio. A 7% drop per day is not an exceptional event for bitcoin, and mass closing of transactions can reduce the dependence of the market on borrowed money. According to the expert, it is more important whether the exchange rate will stay at key price points and whether buyers will return.

When can Bitcoin Recover

The nearest support level, the zone where purchases can stop the decline, is around $ 68-69 thousand, according to Kirill Komalenkov from Bitbanker. If the exchange rate goes lower, the next benchmark will be $65-67 thousand. To recover, bitcoin first needs to return above $ 70-72 thousand, and then hold above $ 73-75 thousand, the expert noted.

Andrey Varnavsky, Director of Digital Assets at Ingosstrakh Investments Management Company, also warns about the risk of accelerating the sale if it falls below $68 thousand. Guzel Protsenko from Alfa-Forex calls the next milestones at which buyers can support the exchange rate, $ 66 thousand and $ 62 thousand. According to her, the selling pressure will weaken if the price is fixed above $ 76 thousand.

So far, there are few conditions for sustainable growth, Kirill Komalenkov believes: investors are waiting for new data on inflation in the United States and signals from the Fed, but there are not enough funds to buy on the market. In the next one to two weeks, the expert expects sharp fluctuations in the range of $ 65-73 thousand. By the end of the year, in the absence of new shocks, the exchange rate may stabilize in the range of $ 65-80 thousand. If the economic situation improves and money starts to return to exchange-traded funds, a rise to $80-85 thousand is possible, the analyst added.

Dmitry Tselishchev, Managing director of the investment company Rikom—Trust, outlined a narrower corridor at the end of the year — $65-70 thousand. In his opinion, large professional investors may become more active near the lower limit — they will support the quotes. However, this scenario assumes the absence of new shocks — a possible increase in the Fed rate could bring the cost of bitcoin closer to $ 60 thousand, the expert warned.

Financial advisor and founder of Rodin.Capital Alexey Rodin in the baseline scenario assumes a decrease to $ 65 thousand.

If we average the experts' estimates, we get about $65-72 thousand, it follows from the calculations of Izvestia.

Thus, the outcome of the year will largely be determined by the Fed's decisions and the willingness of investors to buy cryptocurrencies again. Returning money to exchange—traded funds can help bitcoin recover, while maintaining the outflow and raising the US rate can prolong the recession.