Stifel forecasts a decline in Bitcoin to $38,000.

Stifel analysts forecast that bitcoin may decline to $38,000, utilizing an analogy from the film "The Curious Case of Benjamin Button" to illustrate their pessimistic outlook.

BTC could drop to $38,000, according to Stifel. (keithsutherland/Getty images+/Unsplash)

What to know:

• Stifel analysts anticipate that bitcoin may decrease to approximately $38,000, based on a trend line drawn through the lows of significant crashes since 2010.
• The firm contends that the correlation between bitcoin, the dollar, and global money supply has shifted since 2025, with the cryptocurrency deteriorating as the dollar strengthens and liquidity becomes more constrained.
• The analysts indicate that bitcoin’s increasing correlation with the Nasdaq and growth stocks, along with the Federal Reserve’s hawkish rate adjustments and rising borrowing costs in the tech sector, could exacerbate the current decline.

Analysts are competing to predict the extent to which bitcoin BTC$71,462.61 could decline, with target estimates decreasing each day. Stifel, a leading full-service financial services company based in St. Louis, Missouri, is the latest to join this trend.

Analysts from the 136-year-old firm project that the bitcoin price might plummet to as low as $38,000.

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"Already down -41% from the peak, bitcoin super-bears have adhered to a linear trend indicating a possible low of ~ $38K," stated the team led by Barry B. Bannister in a communication to clients on Wednesday.

They are referencing a straight line connecting the lowest points of every major bitcoin crash since 2010. Bitcoin experienced a decline of 93% in 2011, 84% in 2015, 83% in 2018, and 76% in 2022. A line joining these market bottoms trends upward and suggests $38,000 as the likely low for the current downturn.

Bitcoin reached a peak of over $126,000 in October but has since fallen to nearly $70,000, returning to levels last seen in November 2024.

The curious case of Benjamin Bitcoin

The Stifel analysts illustrated the bearish perspective with a comparison to the film "The Curious Case of Benjamin Button."

In the film, as well as in the F. Scott Fitzgerald narrative on which it is based, Button ages backward while everyone else grows older. Bitcoin mirrors this: a fixed supply limit of 21 million BTC previously strengthened it—”younger” in the analysts’ terms—while the dollar weakened through regular monetary expansion.

Currently, it is unraveling, akin to the child version of Button, who appears 10 yet behaves like he is 80, relegated to playing piano for seniors.

Bitcoin used to appreciate with an increase in global cash and a weaker dollar, but since 2025, this dynamic has reversed. It now declines alongside the dollar. The Dollar Index has fallen by nearly 1% this year, continuing last year’s nearly 10% decrease.

"Before 2025, Bitcoin rose when the dollar decreased and global M2 money supply (converted to dollars) increased, thus ‘aging backward’ in relation to fiat, but after 2025 the correlation has changed," the analysts stated.

This behavior is further complicated by bitcoin’s close tracking of Wall Street’s tech-heavy Nasdaq 100 index and growth stocks, rising on dovish shifts by the Federal Reserve and declining on hawkish moves. Although the Fed reduced interest rates in the last three meetings of 2025, these largely conveyed a hawkish sentiment, minimizing the likelihood of quicker cuts in the future.

This outlook is concerning, the analysts indicated, particularly as technology firms are borrowing more extensively, which has increased their borrowing expenses. This could result in financial tightening, impacting stock valuations and exacerbating the challenges in the bitcoin market.