Miller Tabak strategist Matt Maley said that a further decline in Bitcoin from its current levels around $60,000 could put additional pressure on investor sentiment.
According to Maley, while Wall Street companies continue to invest in the digital asset space, individual investors, who played a significant role in previous cryptocurrency rallies, have now shifted their focus to AI and technology stocks with high growth potential.
Maley noted that the recent significant outflows from Bitcoin ETFs also indicate weakening investor interest. The strategist stated that Bitcoin is signaling a divergence from the stock market, raising concerns that BTC may not benefit from the overall stock market rallies.
Maley also stated that advancements in quantum computing have raised long-term security risks for cryptocurrencies.
22V Research technical strategist John Roque similarly pointed out the downside risks for Bitcoin. In a note he published, Roque stated that Bitcoin retested its first downside target of $60,000 “by a very small margin.” According to Roque, a break below this level could bring about a drop in Bitcoin towards $40,000.
However, Maley added that there are some positive elements on the regulatory front for the crypto market. Noting that expectations remain for the US Congress to pass a crypto market structure bill that would bring clearer rules for digital asset platforms, Maley said that such regulation could reduce uncertainty and encourage broader institutional participation over time.
Bitcoin ETFs recently recorded their largest monthly outflows since 2024. This is reportedly due to institutional investors seeking to mitigate risk amid broader market uncertainty and concerns about higher interest rates.
