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Why Bitcoin Price Could Decrease in the Short-Term According to Forbes Director



Despite remaining bullish over the long run on bitcoin, Forbes Crypto’s Research Director explained why the cryptocurrency could keep retracing in the short-term.

Institutions taking profits and rising interest rates have pushed bitcoin down in the past week, said the Director of Research at Forbes Crypto – Steven Ehrlich.

Simultaneously, he outlined Ethereum’s growing adoption among institutions and the role it plays behind DeFi and NFT as the main reasons why ETH has outperformed BTC last year and continues to do so in 2021.

Bitcoin’s Run Is in Exhaustion Phase

Ever since October 2020, the primary cryptocurrency has been on a roll that saw its price expand by roughly six-fold to a new all-time high record registered in mid-March at $61,800. Year-to-date alone, BTC is up by approximately 80%.

However, this impressive run seems paused at the moment, as bitcoin has lost about $10,000 of value and even came close to breaking below $50,000 yesterday.

The Director of Research at Forbes Crypto touched upon BTC’s ongoing cycle and said that the asset could be in somewhat of an “exhaustion” phase. He believes that some of the institutional investors that entered the market in the past several months have decided to take some profits off the table.

However, he sees an even more potentially-damaging threat with the rising interest rates:

“Whenever interest rates go up, that makes fixed-income investment products comparatively more advantageous for investors because they have a lower-risk profile.”

He added that while bitcoin is “promoted” as a safe-haven asset, it tends to trade recently as riskier investment tools, such as equities.

Nevertheless, Ehrich remains bullish on BTC over the mid- and long-term, despite envisioning a short-term retracement.

Why ETH Outperforms BTC?

While BTC has gained 80% since the start of the year, the second-largest cryptocurrency is more than 110% up. Moreover, ETH also outperformed bitcoin last year.

Ehlrich attributed Ethereum’s better performance to two primary reasons – institutional adoption and the utilization of its network.

As previously reported, institutional investors have enhanced their appetite towards ETH, while some companies have put it on their balance sheets as well.

The Ethereum blockchain is the underlying technology behind two of the most popular crazes in the crypto community – decentralized finance (DeFi) and non-fungible tokens (NFTs).

While the growing usage of the Ethereum network creates issues of its own, this utilization makes the native cryptocurrency all that more attractive to new investors


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