According to Jason Pizzino, Bitcoin’s profit potential is shrinking the higher the price rises. He argues that, as Bitcoin’s market cap has increased, the expected returns are getting “pretty finite” potentially spelling trouble in the long-term for the cryptocurrency.
After reaching a low point in this cycle—in the form of $15,500 in November 2022—Bitcoin has gone through two major rallies. The start, though, was as low as $15,000, with some highs going as high as $74,000—a difference of about $58,000. Bitcoin has gone on to make two other $60,000 moves since, nearly to the dollar.
Given the global nature of the regulatory and financial markets, Pizzino stressed quality behind these moves. He went on to say that markets tend to follow the same patterns. On the flip side, he acknowledged that Bitcoin’s returns are decaying as its price soars.
The good news is that even compared to these $60,000 gains, the returns are getting smaller. The game has not necessarily changed, but there is increased attention on Bitcoin, requiring more capital to reach higher price levels.
A $60,000 increase from the all time peak would put Bitcoin at over $130,000. For example, if Bitcoin were trading at $84,679, a $60,000 bump would raise it to $144,679.
The market price of Bitcoin is down less than a tenth of a percent over the past day. According to Pizzino, the risk is much greater now than it was in the first half of the cycle.
