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Bitcoin is cheap – Ethereum could be near the bottom – Is it time to invest?

Fidelity’s head of Global Macro shared his price outlook for bitcoin and ether. His analysis shows that bitcoin is cheap but ether could be even cheaper. “Ethereum could be close to a bottom,” he added.

Fidelity head speaks on bitcoin and ether price outlook

Jurrien Timmer, director of Global Macro at Fidelity Investments’ global asset allocation division, shared his analysis of bitcoin and ether prices in a series of tweets on Friday. Timmer specializes in global macro strategy and active asset allocation. Read also: What can traders expect from the price of bitcoin (BTC) in the next 24-48 hours?. He joined Fidelity 27 years ago as a technical research analyst.

He explained why bitcoin is cheap. “I’m using the price per million non-zero addresses as an estimate of bitcoin’s valuation, and the chart below shows the valuation is fully back to 2013 levels, although the price hasn’t come back than at 2020 levels,” he explained, emphasizing:

In other words, bitcoin is cheap.

“At its recent low of $17,600, bitcoin is now below even my more conservative S-curve model, which is based on the internet adoption curve,” the Fidelity director added.

Mr. Timmer noted that by observing the growth of the Bitcoin network, it is clear that “the adoption curve follows the more asymptotic curve of Internet adoption, rather than the more exponential curve of mobile phones”. He continues: “According to Metcalfe’s law, slower network growth suggests more modest price appreciation. »

However, “based on a simple power regression line, Bitcoin’s network appears to be intact,” the director opined. “This continued growth of the bitcoin network, combined with falling prices, means the valuation of bitcoin is falling. »

The director of Fidelity’s Global Macro department then shared his predictions for the price of ether, tweeting:

If bitcoin is cheap, then maybe ethereum is cheaper. If ETH is where BTC was four years ago, then the analogy below suggests that Ethereum may be close to bottoming.

At the time of writing, bitcoin is trading at $21,584, up 11% over the past seven days but down 29% over the past 30 days. Ether is trading at $1,217, up 14% in the last seven days but down 32% in the last 30 days.

What do you think of the Fidelity director’s analysis of bitcoin and ether prices? Let us know in the comments section below.

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Thomas Estimbre
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