Standard Chartered (STAN) bank is forecasting that the price of Bitcoin (BTC) will plunge 70% to $5,000 U.S. in 2023.
Bitcoin is currently trading just above $17,000 U.S. and is already down 75% from an all-time high of $68,000 U.S. reached in November 2021.
In a note to clients titled “The financial-market surprises of 2023,” Standard Chartered said it feels Bitcoin is still trading at overvalued levels and due to fall further in the coming 12 months.
“More and more crypto firms and exchanges find themselves with insufficient liquidity, leading to further bankruptcies and a collapse in investor confidence,” wrote Standard Chartered in its 2023 outlook.
The cryptocurrency sector continues to deal with the fallout from the bankruptcy of digital exchange FTX, which was valued at more than $30 billion U.S. prior to its unexpected collapse on November 11 of this year.
Standard Chartered added that the continued decline in Bitcoin’s price will coincide with a 2023 rally in the price of gold. The bank forecasts that gold prices could rally 30% to $2,250 U.S. per ounce in the coming year.
Standard Chartered said it expects gold to re-establish itself as a safe haven with investors flocking to the commodity in growing numbers amid ongoing stock market volatility.
Standard Chartered’s forecast is not the only bearish outlook for Bitcoin. Veteran investor Mark Mobius said last week that he sees Bitcoin declining to $10,000 U.S., or lower, in 2023.
Standard Chartered’s stock is up 29% this year at 595.80 British pounds (Cdn$990.99) per share.
