Matrixport warns of market euphoria, correction after Bitcoin's $60K milestone

The blockchain financial service firm argued in January that a spot Bitcoin ETF would not be approved by the U.S. Securities and Exchange Commission.

Daniel Yan, co-founder of Singaporean crypto services firm Matrixport, says that a market correction is imminent after Bitcoin (BTC) reached its highest level since 2021.

“The sentiment of the market has come to a level where I think we should be cautious,” the co-founder wrote on February 28. “I think we should see another healthy ~15% correction by end-April.” In explaining his rationale, Yan said that the month of March is a “tricky one” from a macroeconomic perspective, pointing to examples such as the U.S. Federal Reserves meeting, Bitcoin halving, and the Ethereum Dencun upgrade. Yan stated:

“From where, 65k or 60k or now? I really don’t know. I don’t even know which comes sooner – a new ATH in BTC or the correction. Again – you don’t have to bother too much on this if you are a long-term holder. For those who are tempted to trade the short term moves, watch March.”

On the same day, Bitcoin surpassed the $60,000 benchmark previously witnessed in the bull market of 2020 to 2021. Data from the Crypto Fear & Greed Index currently shows a score of 82/100, indicating extreme greed. Investors have been in a frenzy since the U.S. Securities and Exchange Commission (SEC) approved several spot Bitcoin exchange-traded funds (ETFs) last month, with $7.5 billion worth of assets now managed by one such ETF, BlackRock’s iShares Bitcoin Trust.

Despite Yan’s bearish sentiment, Matrixport has not always been accurate in its market predictions. In January, when Bitcoin was trading at $40,800, Matrixport warned investors that the SEC may not approve spot Bitcoin ETFs due to political risk factors. Since then, spot Bitcoin ETFs were, in fact, approved, with Bitcoin returning more than 50% within weeks’ time. 

Euphoria: the sentiment of the market has come to a level where I think we should be cautious – may be a good idea to revisit my pinned tweet on the size of potential corrections. I think we should see another healthy ~15% correction by end-April.

— Daniel Yan (@_D_Y_A_N) February 28, 2024

Related: Bitcoin breaches $60K for the first time in over 2 years