Bitcoin (BTC) Price Could Drop Another 20% in Coming Months, Warns Bitfinex

The bearish forecast comes as Bitcoin's price slumps to begin September, declining 2.25% to currently trade at $56,600 U.S.

Cryptocurrency exchange Bitfinex has warned that Bitcoin (BTC) could still drop another 20% in coming months, bottoming around $40,000 U.S.

The bearish forecast comes as Bitcoin’s price slumps to begin September, declining 2.25% to currently trade at $56,600 U.S.

The world’s leading cryptocurrency has seen a strong start to the year, rallying 28% year-to-date. However, the recent downturn marks a seven percent decline over the past month.

According to Bitfinex, the expected interest rate cut from the U.S. Federal Reserve at its next policy meeting on Sept.18 is likely to not be enough to counter fears of a recession in America.

As a result, Bitcoin (BTC) could drop as much as 20% and bottom around $40,000 U.S. between now and Halloween.

The report adds that even a bigger-than-expected 50-basis point interest rate cut will not be enough to ease mounting anxiety about a slowing U.S. economy, which has gripped Wall Street and led to a selloff in risk assets such as cryptocurrencies.

The report also notes that cryptocurrencies are likely to experience “seasonal effects” in coming months, with September typically one of the weakest months of the year for crypto.

Conversely, October through April has historically been the strongest time of the year for Bitcoin and other digital assets.

In its conclusion, the Bitfinex report states that attractive entry points and buying opportunities for Bitcoin and other cryptocurrencies could emerge in coming weeks.

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