Peter Brandt and Bernstein Analyst: Bitcoin Could Drop Below $40,000

Veteran trader Peter Brandt has suggested a potential decline in Bitcoin’s value below $40,000. He is known for applying Bayesian Probability Theory to market analysis.

Brandt’s methodology involves revising the likelihood of events as new data emerges. This approach is a central tenet of Bayesian Probability Theory, which helps investors adjust their predictions based on changing information.

Peter Brandt: There Are 65% Chances of Bitcoin Dropping Below $40,000

Brandt, who first began trading Bitcoin in 2016, initially believed there was a 50% chance the cryptocurrency could reach $100,000. Equally, he thought it might fail, resembling the modern equivalent of a “Pet Rock.”

However, over time, Brandt’s perspective has evolved, significantly influenced by proprietary technical analysis tools.

For instance, in early June, Brandt assigned a 50% probability of a drop to $30,000 and a 50% chance of rising to $140,000. However, his current projections have shifted to the following:

• 65% chance of Bitcoin falling under $40,000
• 20% chance of Bitcoin peaking at $80,000
• 15% chance of Bitcoin hitting $130,000 by September 2025

Read more: Bitcoin (BTC) Price Prediction 2024/2025/2030

Adding to the discourse, Bernstein analyst Gautam Chhugani highlighted the impact the upcoming US Presidential election might have on Bitcoin prices. According to Chhugani, the outcome—whether Donald Trump or Kamala Harris wins—could dramatically affect the cryptocurrency’s trajectory.

“We expect the delta between the two political outcomes to be wide. We expect Bitcoin to claim back new highs, in case of a Trump win and by Q4, we expect Bitcoin to reach close to $80,000-$90,000 range. However, if Harris wins, we expect Bitcoin to break the current floor around $50,000 and test the $30,000-$40,000 range,” Chhugani stated.

This year, Bitcoin has fluctuated between $55,000 and $70,000, following its peak in March. As of writing, it is trading at around $56,500, up by 3% in the past 24 hours.

The cryptocurrency’s fate seems intertwined with the US election results scheduled for November 5. Furthermore, the broader political climate, particularly the positions of US politicians towards cryptocurrencies, also plays a crucial role.

Standard Chartered has predicted a surge to $150,000 for Bitcoin if Trump, who has positioned himself as a pro-crypto candidate, is re-elected. Meanwhile, Democratic policies, especially those influenced by figures like Massachusetts Senator Elizabeth Warren and US Securities and Exchange Commission (SEC) Chair Gary Gensler, are viewed as less favorable towards cryptocurrencies.

Read more: Who Is Gary Gensler? Everything To Know About the SEC Chairman

Hence, Chhugani emphasized the broader implications of a favorable regulatory environment for cryptocurrencies.

“A crypto-friendly election outcome and positive regulatory environment is not priced in. A positive regulatory environment would take away the policy risk for financial institutions and banks to participate, thus removing the handicap for digital assets to compete with traditional assets for institutional flows,” Chhugani said.