The price of bitcoin remains under pressure from sellers amid falling stock indices and rising government bond yields. The yield on 10-year Treasury bonds reached 1.56%, updating the 3-month high. The increase in profitability is due to growing inflation expectations against the background of a significant increase in energy prices, as well as the upcoming reduction in the volume of asset purchases by the Fed.
Investors’ withdrawal from risky assets is due to several factors: the risks of default by the Chinese developer Evergrande (HK:3333), power outages in China due to a shortage of coal, as well as the threat of a shutdown and the achievement of the US government debt ceiling.
Morgan Stanley (NYSE:MS) continues to accumulate bitcoins through the Grayscale Bitcoin trust.
According to a recent report filed with the Securities and Exchange Commission, as of July 31, the bank acquired an additional 58,116 shares of GBTC, in addition to the 928,051 shares acquired earlier.
Deutsche Bank (DE:DBKGn) analyst Marion Laboure stated that bitcoin could become “digital gold”, noting that the probability that any other cryptocurrency will be able to surpass bitcoin and ethereum is small.
In her report, Labur also noted some disadvantages of cryptocurrencies, including their high volatility, lack of a clear regulatory framework and energy-intensive mining. However, despite these shortcomings, the analyst believes that cryptocurrencies are the best alternative to fiat money as a payment method, stating that cash transactions will soon disappear. Labur noted that the limited supply of bitcoin made it a better alternative than fiat money.
According to technical analysis, a breakdown of the 40,000 support level will open the way to 37,700. In case of consolidation above 44,300, an increase to 46,700 is likely.