Bitcoin’s (BTC) current struggle with bearish sentiments is likely to intensify as the market anticipates a possible influx of capital.
Specifically, the market expects a dump of Bitcoin worth approximately $9 billion as the defunct crypto exchange Mt. Gox plans to make repayments starting in July 2024.
These long-awaited repayments mark the end of a decade-long ordeal for creditors since Mt. Gox ceased operations on February 24, 2014, following a hacking incident.
At its peak, the exchange handled over 70% of all Bitcoin transactions worldwide, but it halted trading and went offline, leading to significant financial losses for many investors. The repayment process will also involve approximately $50.8 million in Bitcoin Cash.
To put the significance of the amount into context, Bloomberg senior ETF analyst Eric Balchunas noted that it was equivalent to over half of all exchange-traded fund inflows being negated in one shot.
Mt.Gox’s impact on Bitcoin’s price
Indeed, the offloading of such an amount of Bitcoin in the market could impact the price of Bitcoin, which is already facing bearish pressure.
In this context, if Mt. Gox repayments will have a negative impact, Finbold consulted OpenAI’s latest and most advanced artificial intelligence tool, ChatGPT-4o, to gather insights on how low Bitcoin can go in such an event.
In predicting the next Bitcoin low, the AI tool reviewed elements such as technical analysis of historical price patterns, support and resistance levels, and moving averages. According to ChatGPT-4o, broader economic indicators, regulatory news, and trends in financial markets could further influence Bitcoin’s price trajectory.
ChatGPT-4o Bitcoin price prediction
Given the bearish outlook and the potential market impact of the Mt. Gox repayments, ChatGPT-4o anticipates downward pressure on Bitcoin prices in the near term.
The AI platform noted that key support levels to monitor include $58,000 to $60,000, a psychological and historical support zone; $55,000, a strong support level based on past price actions; and $50,000, a major psychological barrier and robust historical support.
Should Bitcoin break below the $50,000 mark, the AI tool anticipates further declines, potentially driving the price down towards $45,000, which has previously been a strong support level during corrections.
ChatGPT-4o maintained a bullish long-term outlook for Bitcoin despite short-term bearish pressures. Factors contributing to this optimism include increasing institutional adoption, the decreasing new supply due to halving events, and the growing acceptance of Bitcoin as a store of value.
For investors looking to capitalize on potential dips, ChatGPT-4o suggested monitoring the approach to key support levels, looking for signs of price stabilization or reversal, and tracking indicators of reduced fear or increased investor confidence. Once the impact of the Mt. Gox repayments are absorbed, alleviated selling pressure could present a more favorable market condition.
Bitcoin price prediction. Source: ChatGPT-4o
Bitcoin price analysis
Based on short-term price movements, Bitcoin will likely lose the $60,000 support unless a significant market-moving incident occurs.
As of press time, Bitcoin was valued at $61,120, dropping almost 5% in 24 hours. The magnitude of the recent sell-off is evident on the weekly chart, where the asset has fallen over 7% after losing the $66,000 support.
Bitcoin seven-day price chart. Source: Finbold
Overall, should Bitcoin lose $60,000 in support, investors should anticipate further losses in line with the ChatGPT-4o prediction.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
