Bitcoin’s potential to rally to $30,000 is threatened by escalating economic uncertainty and regulatory pressure despite all the right pieces being in place. On March 23, Bitcoin’s price bounced back to $28,000 after correcting below $27,000, closely following the traditional financial sector, especially the tech-heavy Nasdaq Index. While the Federal Reserve’s recent benchmark interest rate increase appears encouraging, global economies are exhibiting signs of stress, including decreased consumer confidence in the euro area and companies’ layoffs.
As Bitcoin’s correlation to traditional markets strengthens, professional traders remain unconvinced about its price increase. Margin and futures markets indicate that whales and market makers were ill-prepared, but the absence of excessive leverage on long positions is positive. Recession risks and growing regulatory uncertainty, such as the United States Securities and Exchange Commission’s Wells notice against the Coinbase exchange, will likely keep the price of Bitcoin below $30,000 for the time being.