{"id":91185,"date":"2025-11-19T12:53:02","date_gmt":"2025-11-19T09:53:02","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=91185"},"modified":"2025-11-19T12:57:12","modified_gmt":"2025-11-19T09:57:12","slug":"standard-chartered-bitcoin-correction-has-run-its-course","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/standard-chartered-bitcoin-correction-has-run-its-course\/","title":{"rendered":"Standard Chartered: Bitcoin correction \u2018has run its course\u2019"},"content":{"rendered":"

The cryptocurrency-market correction has run its course. Standard Chartered\u2019s head of digital-asset research, Jeffrey Kendrick, predicted a year-end rise in bitcoin\u2019s price, reports The Block<\/a>.\u00a0<\/p>\n

He said the latest decline is comparable with two major sell-offs over the past two years. Although more painful, it is a typical retracement for the current cycle with a similar percentage depth.<\/p>\n

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Source: The Block\/Standard Chartered<\/a>.\u00a0<\/figcaption><\/figure>\n
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\u201cThe argument is simple, and the most compelling cases usually are,\u201d the expert noted.<\/em><\/p>\n<\/blockquote>\n

Signs of a bottom\u00a0<\/h2>\n

Kendrick stressed that key indicators have reached extremes, signalling proximity to a cycle low. One is Strategy\u2019s mNAV<\/span>, which dropped to 1.\u00a0<\/p>\n

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\u201cI believe the current readings make a convincing case that the correction is over and refute the idea that the <\/em>halvings<\/em><\/a>-linked cycle is no longer relevant. My base case is a recovery into year-end,\u201d the analyst said.\u00a0<\/em><\/p>\n<\/blockquote>\n

In late October, the Standard Chartered expert said<\/a> that bitcoin was unlikely to fall below $100,000 again.\u00a0<\/p>\n

Kendrick argued his case with improving macro conditions and positive flows at the time into spot ETF<\/a> based on the asset.\u00a0<\/p>\n

Since early November the vehicles have lost about $3 billion. In the latest session $372 million was pulled\u2014outflows have continued for a fifth straight day.\u00a0<\/p>\n

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Flows in and out of spot bitcoin ETFs. Source: SoSoValue<\/a>.\u00a0<\/figcaption><\/figure>\n

A similar pattern is seen in Ethereum-focused ETFs, which have shed $1.7 billion over the past two weeks.<\/p>\n

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Flows in and out of spot Ethereum ETFs. Source: SoSoValue<\/a>.\u00a0<\/figcaption><\/figure>\n

Kendrick\u2019s year-end bitcoin forecast remains<\/a> $200,000, and for Ethereum \u2014 at $7,500<\/a>. By 2028 he expects<\/a> to see digital gold at $500,000 and the second-largest cryptocurrency at $25,000.\u00a0<\/p>\n

Why the market fell\u00a0<\/h2>\n

Some experts<\/a> argue the current crypto-market decline reflects a liquidity shortfall amid a US shutdown<\/a>, rather than fundamentals such as ETF outflows or waning activity among DAT<\/span> firms.\u00a0<\/p>\n

Arthur Hayes, the founder of BitMEX, takes a similar view. In a new essay, Snow Forecast<\/span>, he noted<\/a> that the market has not faced a narrative shift but the disappearance of \u201cartificial supports\u201d.\u00a0<\/p>\n

While the spread between futures and spot ETFs remained attractive, ETFs and crypto treasuries created steady demand, masking deteriorating liquidity.\u00a0<\/p>\n

But \u201cwhen the basis falls, they quickly dump their positions\u201d. That, Hayes argues, was the starting point of the correction.\u00a0<\/p>\n

At the same time, premiums at DAT firms collapsed: Strategy\u2019s mNAV plunged below 1, removing two big sources of capital inflows that had supported bitcoin since spring.\u00a0<\/p>\n

Hayes said this does not signal a cycle change, but a reaction to the actual state of US dollar supply.<\/p>\n

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\u201cMoney is politics. And political rhetoric, which changes quickly, affects market expectations about the future supply of dirty fiat.\u201d\u00a0<\/em><\/p>\n<\/blockquote>\n

With ETF inflows absent and DAT activity down\u2014previously cushions against the liquidity shortfall\u2014bitcoin is reflecting current conditions and falling in price.<\/p>\n

Parallels with the past\u00a0<\/h2>\n

Hayes drew a parallel between the second halves of 2023 and 2025: both concluded with a debt-ceiling increase followed by a liquidity drain.<\/p>\n

He says what happens next is predictable: once politicians heed voters frustrated by rising prices, a cycle of \u201ctough talk against the printing press\u201d begins.<\/p>\n

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\u201cAfter a sharp market drop, they have only two options: either print money again to save the system, or allow credit to contract, risking the destruction of wealthy asset holders and triggering mass layoffs,\u201d Hayes explained.<\/em><\/p>\n<\/blockquote>\n

He considers the choice obvious: inflation is a more \u201cconvenient\u201d political risk than mass unemployment. He therefore remains confident stimulus will continue \u2014 earlier Trump announced<\/a> a \u201cdividends\u201d programme for Americans funded by tariff revenues.<\/p>\n

Bull case\u00a0<\/h2>\n

The expert also examined the optimists\u2019 arguments. After the shutdown, the Treasury could indeed add $100\u2013150 billion to the system, and the Fed could halt balance-sheet reduction. But Hayes believes the liquidity drain is far larger:<\/p>\n

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\u201cAbout $1 trillion of dollar liquidity has evaporated since July. Adding $150 billion is nice, but what then?\u201d<\/em><\/p>\n<\/blockquote>\n

He noted that Fed officials\u2019 talk of the need for fresh quantitative tightening<\/a> remains rhetoric. In his view, even if the \u201cprinting press\u201d restarts later, markets will likely first retrace to fundamentally justified levels.<\/p>\n

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\u201cBefore we return to Up Only<\/span>, markets must fall low enough to accelerate money printing.\u201d<\/em><\/p>\n<\/blockquote>\n

Hayes also outlined the current strategy at the Maelstrom fund. It has increased its share of stablecoins<\/a>, expecting the correction to continue.<\/p>\n

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\u201cThe only asset that I believe can outperform the negative dollar-liquidity backdrop in the short term is <\/em>Zcash<\/em><\/a>,\u201d he said.<\/em><\/p>\n<\/blockquote>\n

Outlook\u00a0<\/h2>\n

Hayes pointed out that bitcoin\u2019s sharp drop from $125,000 to $90,000, even as stock indices hit records, is an ominous signal:<\/p>\n

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\u201cIt tells me a credit event is brewing.\u201d<\/em><\/p>\n<\/blockquote>\n

He estimates that if equities correct by 10\u201320% and ten-year yields approach 5%, authorities will have a \u201cpressing need\u201d to start printing again. That, he says, could send bitcoin to $200,000\u2013250,000 by year-end.<\/p>\n

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The last time bitcoin was here, global liquidity was $7 trillion lower pic.twitter.com\/MveSuWGWkS<\/a><\/p>\n

\u2014 zerohedge (@zerohedge) November 18, 2025<\/a><\/p><\/blockquote>\n