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Bitcoin and crypto prices have struggled since hitting all-time highs in October, with crash fears fueled by even the most bullish of investors.
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The bitcoin price has fallen from a peak of $126,000 per bitcoin to just over $85,000, plummeting more than 30% as Tesla billionaire Elon Musk predicts the end of money.
Now, as traders brace for a $30 trillion Federal Reserve earthquake, the bitcoin price could be teetering on the verge of a massive crash that could wipe out almost all cryptocurrencies.
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“Bitcoin’s rally above $100,000 may have sparked a cycle back toward $10,000, potentially in 2026,” Mike McGlone, senior commodity strategist at Bloomberg Intelligence, posted to LinkedIn.
“Wealth-creation reversion will likely drive the next recession, led by a collapse in highly speculative, unlimited-supply digital assets—most of which track nothing.”
A near-90% bitcoin price crash to $10,000, a level not seen since 2020, could see the wider $3 trillion crypto market reduced to around $300 billion.
Pointing to bitcoin’s price plummet since October, McGlone warned its downturn could spiral due to what he called “post-inflation deflation.”
“Bitcoin falling alongside Fed funds,” McGlone wrote on X. “Since the Fed cut 25 basis points on September 17, bitcoin has dropped almost 25%. Is it the start of post-inflation deflation or just a dip in the uptrend? My bias is the former.”
McGlone also warned of a situation that could resemble stocks in 2007 when the U.S. stock market hit record highs while the Federal Reserve began cutting interest rates to address emerging economic stresses.
Despite those interest rate cuts, starting with a 50 basis point reduction in September 2007, stocks peaked shortly after and then crashed over 50% into the 2008 financial crisis.
“Falling bitcoin may mirror 2007 stocks vs the Fed,” McGlone wrote on the Bloomberg Terminal.
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Forbes Digital Assets
Meanwhile, other bitcoin and crypto analysts have also warned the fatigued market is looking at risk of an immediate decline.
“Bitcoin eked out a modest gain this morning, but not enough to cover yesterday’s losses,” David Morrison, senior market analyst at Trade Nation, said in emailed comments.
“Trade was looking quite constructive for a while. Bitcoin bounced off its multi-month low near $80,000 in November when it was very oversold, according to its daily moving average convergence/divergence (MACD). It went on to make a succession of higher lows and higher highs. But it now looks as if it is running out of puff, with a very real danger that it breaks back under its recent low from early December. If so, then another pullback to $80,000 can’t be ruled out.”