Analyst claimed that Bitcoin had a “dip first and then rise” cycle, gave a target of $ 1 million for BTC!

Bitwise Chief Investment Officer Matt Hougan, Bitcoin’in (BTC) He usually describes the moments of crisis that he reacts with a strong recovery after a sharp decline, and he describes this as “first as an upward rise”. In a note he sent to customers, Hougan announced that this phenomenon was recently observed after President Trump’s customs -based market decline.

Although Bitcoin is often seen as a long -term hedge presence, short -term harsh decreases during the fluctuations on the market disappoint many investors by tending to experience. According to a previous study by Bitwise, Bitcoin has historically decreased by 30 %more than significant decreases in S&P 500. However, investors who did not sell or buy more during these decreases gained an average of 190 %of the following year and strengthened the “first dip and then rise” trend.

Hougan attributes this to Wall Street’s “Net present value” approach; This approach is a common valuation method that determines the value of an asset according to the reduction of future gains to the present value. Traditional companies use reduced cash flow (DCF) analysis to calculate the current value by adjusting future cash flows to risks and interest rates.

Bitcoin, which lacks cash flow, is still affected by a similar concept. Bitwise estimates that Bitcoin will be worth $ 1 million by 2029. However, its current value is affected by the fluctuating discount factor depending on its market uncertainty. For example, with a 50 %discount rate, the net value of Bitcoin is approximately $ 218,604, while the 75 %discount rate reduces this value to $ 122.633.

After Trump’s election victory in November, Bitcoin rise to around $ 70,000 in mid -January, the highest level of all time, over $ 109,000. However, new customs tax announcements targeting imports from China, Canada, Mexico and the EU led to a large turmoil in the market, and at the beginning of this month, Bitcoin decreased to $ 76,700 with a decrease of approximately 30 %. S&P 500 decreased by about 10 %in the same period.

Nydig’s comments of corporate Bitcoin firm, Bitcoin’s connection with the tariff -related market disruptions, is primarily due to a high liquidity, a globally traded asset. According to Nydig, customs duties lead to short -term uncertainty, increasing the perceived risk and discount factor of Bitcoin. However, in the long run, Bitcoin provides benefits as a protection against geopolitical and economic instability.

Hougan explained this effect with a hypothetical scenario: If customs duties increase Bitwise’s price target of 2029 Bitcoin from $ 1 million to $ 1.1 million and at the same time increases the discount rate from 75 %to 85 %, Bitcoin’s current value decreases from 122.633 dollars to $ 109.521 dollars. This explains the short -term decrease and a potential recovery may be experienced if the discount factor becomes stable.

*It is not an investment advice.