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Cryptocurrencies are going to suffer even more if the Federal Reserve significantly shrinks its balance sheet
Disclaimer: The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of U.Today. Every investment and all trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.
FS Investments Chief Market Strategist Troy Gayeski is convinced that cryptocurrencies could face more selling pressure if money supply growth goes negative.
The U.S. Federal Reserve shrinking its balance sheet is going to be a major bearish catalyst for Bitcoin.
“You should never own more crypto than you could tolerate losing,” Gayeski said.
Bitcoin is currently changing hands slightly above the $20,000 level after shedding recent gains together with U.S. stocks on Tuesday.
Yet, crypto is still one of those asset classes that could potentially quintuple in value over the next four years, according to Gayeski.
Bitcoin is down more than 70% from its record high, CoinGecko data shows.
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