Prediction market traders have turned increasingly bearish on Bitcoin and Ethereum, indicating expectations of further declines for both cryptocurrencies as market sell-offs persist. Current predictions show a strong inclination toward Bitcoin dropping to $55,000 and Ethereum declining to $1,500 before any potential rebounds.
Traders utilizing the Myriad prediction market platform, which is operated by Dastan, assign a 77% probability to Bitcoin plummeting to $55,000 before it rebounds to $80,000. Similarly, there is an 88% likelihood of Ethereum falling to $1,500 before potentially rising to $3,000. This bearish sentiment has intensified over the past month, with the odds of Bitcoin hitting the $55,000 mark increasing by 44% during this period. Currently, Bitcoin’s price stands at $59,511, reflecting a 1% drop in the last 24 hours and a substantial 23% decrease over the past month. Earlier on Thursday, Bitcoin dipped to as low as $58,000, marking its lowest price point since 2024.
The downturn in the cryptocurrency market appears to be exacerbated by the performance of traditional markets, particularly shares of Strategy (MSTR), a leading treasury firm for Bitcoin. These shares have reflected a significant decline, falling nearly 7% on Thursday and trading at around $88, resulting in a nearly 45% decrease in the last month. The firm’s preferred equity offering, STRC, which typically trades around a par value of $100, is also facing challenges, recently trading at $77 after a 22% drop in the last month and hitting an all-time low of $73.62 shortly after the market opened.
Matt Hougan, Chief Investment Officer at Bitwise, highlighted that STRC is significantly influencing Bitcoin’s market behavior. He noted that while macroeconomic factors such as inflation concerns and potential rate hikes play a role, the market is particularly focused on STRC’s fluctuations in the $70 range, raising fears that Strategy could enter a “death spiral” and be compelled to sell off its Bitcoin holdings. According to Hougan, this pressure is likely to persist until the firm addresses these concerns.
As the market grapples with fear-driven price movements, analysts suggest that Strategy’s optimal approach might be to strengthen its cash position to ease investor anxieties about dividend obligations. In a broader context, Ethereum has not escaped the fallout. It has dropped to $1,576, equating to a 2.6% decline in the last 24 hours and more than a 25% fall over the past month. Ethereum currently sits just 5.2% above the critical $1,500 level as projected on Myriad.
Furthermore, traders on other prediction market platforms are expressing long-term bearish outlooks for both cryptocurrencies. Kalshi markets indicate a 36% chance of Bitcoin falling below $40,000 and a 34% chance for Ethereum dipping below $1,000 by 2026. Currently, Bitcoin is trading nearly 53% below its all-time high of $126,080, which was reached last October, while Ethereum is more than 68% off its all-time high of $4,946 from the previous August.
