says<\/a> that Bitcoin is now facing a monetary policy environment of rising interest rates after coming of age in an era of historically low-interest rates.<\/p>\nAccording to the macro analyst, the price of Bitcoin is now in the \u201cprocess of reverting.\u201d<\/p>\n
\u201cThe key thing is 800-pound gorilla\u2026 the Federal Reserve is still tightening. So I think this process of reversion is in place.\u201d<\/i><\/p>\n
When interest rates are high, risk assets such as Bitcoin typically tend to fall in price as they become less attractive to investors who now have relatively safer assets offering enhanced returns such as government paper to put their money into.<\/p>\n
McGlone says that consequently Bitcoin could drop by over 5% from the current level and trigger a flight from other risk assets.<\/p>\n
\u201cI think it\u2019s at risk of dropping below $25,000 and taking everything risk with it.\u201d<\/i><\/p>\n
On Bitcoin\u2019s future, the Bloomberg Intelligence analyst says,<\/p>\n
\u201cThe pump in the price [of Bitcoin] was excessive. And we\u2019ve seen that in Amazon [online retailer\u2019s stock]. We\u2019ve seen that in all risk assets and I think it\u2019s still going to be the leading indicator.<\/i><\/p>\n
At some point, I think it\u2019s going to turn around and trade more like gold and treasury bonds\u2026 we\u2019ve had a bounce this year and it\u2019s starting to roll back over.\u201d<\/i><\/p>\n
Bitcoin is trading for $26,778 at time of writing.<\/p>\n