Bitcoin has historically corrected 85% from its highs, and right now, the coin is still in a bear market, said Richard Heart, founder of Hex.
“I think Bitcoin will tap $10,000 from its high of $65,000 because that’s what it normally does, it drops 85%. Ethereum usually drops 95% because it has lower liquidity so it acts like a leverage position on Bitcoin, to some degree,” Heart told David Lin, anchor for Kitco News.
Heart doesn’t agree with the notion that more institutional adoption of Bitcoin will likely make the market less volatile.
“In a reflective system, you have a parabolic rise up,” he said. “When you finally fall out of the parabola, the rule of thumb is that you drop 85% of the move. But in Bitcoin, you don’t just drop 85% of the move normally, you drop 85% of the total. So we have seen hockey stick run-up, fall out and drop 85%, over and over again.”
For more information on Hex and Heart’s views on the broader crypto market, watch the video above. Follow David Lin on Twitter: @davidlin_TV (https://twitter.com/davidlin_TV).
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.