As Bitcoin Tanks, Ex-Goldman Sachs CEO is “Keeping an open mind”

Paigambar Mohan Raj
bitcoin-backed loans

Goldman Sachs Senior Chairman, and former CEO, Lloyd Blankfein has given his thoughts about the current developments in the crypto market space. With charts on the downtrend, the veteran investor took to Twitter and questioned, with the onset of inflation, and the constant reminder that governments can freeze any account at any moment, crypto should ideally be having its moment, but the price doesn’t reflect the same. On Monday, Bitcoin (BTC) fell below $38,000, wiping out all of the previous week’s gains. 

He did, however, state that he is;

“Keeping an open mind about crypto.”

Blankfein’s opinion garnered a response from all corners of Twitter. Top Bitcoin proponent, Micheal Saylor, was one of the respondents. Saylor explained that traditional traders who perceive Bitcoin as something to purchase or sell, based on their present risk assessment and interest rate forecasts, are at odds with fundamental investors who just want to buy it all and hold it forever. He states that;

“Over time, the HODLers will win.”

Can Bitcoin make its way back?

The recent losses looked to be mostly due to risk-on market selloffs, headed by an 18% increase in international oil benchmark Brent crude to about $139 per barrel early Monday, its highest level since 2008.

The inability of Bitcoin to provide a hedge against continuous market volatility has raised questions about its “haven” status, with its correlation coefficient with the Nasdaq Composite reaching 0.87 on Monday.

Moreover, Gold saw a surge in its price, hitting almost $2000. This was last seen in August of 2020. Bitcoin’s correlation with gold was -0.38, indicating that they have been mostly moving in different directions throughout the current market upheaval. 

On shorter timeframes, however, some technical and on-chain signs are flashing positive. If history repeats itself, Bitcoin’s recent drop to its multi-year rising trendline support might pave the way for a rally toward the $60,000 resistance level. 

Additionally, the number of Bitcoin whales has been on the rise. On-chain data from CoinMetrics indicates that whale investors have been purchasing Bitcoin at similar levels.

Even as BTC trades around its six-month low, data from crypto analytics service Santiment shows that Bitcoin’s weekly outflow from exchanges has been positive 81 percent of the time since October 2021. 

In 21 of the last 26 weeks, BTC has moved more off exchanges than on exchanges. Bitcoin exchange outflows have increased, indicating that investors are looking to invest for the long run. Increased Bitcoin inflows to exchanges, on the other hand, indicate a desire to trade BTC for other digital assets or fiat currency.

At the time of publication, Bitcoin (BTC) was trading at $39,194.11, up by 1.1%.