Henrik Zeberg, Head Economist at SwissBlock, predicts Bitcoin will surge to $175,000 and Ethereum to $17,000 before a catastrophic market crash comparable to the dot-com bubble destroys most cryptocurrency projects within six to nine months.
What to Know:
- Zeberg expects a final "melt-up" phase to drive Bitcoin between $165,000-$175,000 and Ethereum near $17,000 before a major market collapse
- A surging US dollar to 117-120 levels will serve as the "wrecking ball" that triggers massive deleveraging and destroys risk assets globally
- The economist warns that 99% of crypto projects will fail in the coming crash, similar to the dot-com bubble, with only utility-focused projects surviving
Market Timing and Technical Indicators
Zeberg positions the current market late in the business cycle but emphasizes that classic recession signals have not yet appeared. He monitors yields, credit spreads, and initial jobless claims for confirmation of timing. "A crash doesn't come out of thin air," Zeberg explained during his September 4 interview with Dutch host Paul Buitink. "We simply don't see those signals just yet."
The economist expects the Federal Reserve to begin cutting rates with 25 basis points this month, though he leaves open the possibility of larger moves. Initial rate cuts may boost markets temporarily, but Zeberg believes sophisticated investors will interpret continued easing as economic weakness rather than support.
Global liquidity improvements and the Fed's dovish pivot create conditions for what Zeberg calls a "sharp upside phase reminiscent of Japan's 1989 finale." He projects the S&P 500 reaching 7,500 to 8,200 from current levels around 6,400 before the cycle turns.
Cryptocurrency Surge Before Collapse
Bitcoin will "lurch first to at least $140,000" before topping between $165,000-$175,000, according to Zeberg's analysis. Ethereum could reach approximately $17,000 based on his assumption that the ETH/BTC ratio stretches to 0.12 during the late-cycle altcoin phase.
"When things are moving in crypto and into the final phase of a bubble, it can be very, very fast," Zeberg warned.
The movement will be "abrupt rather than leisurely" as momentum and FOMO drive the final surge.
The economist delivered particularly harsh criticism of MicroStrategy, calling it "the largest open Ponzi game." He argued that the company's Bitcoin accumulation strategy creates a dangerous feedback loop where investors must continue buying the stock to enable more debt-funded Bitcoin purchases. "Everybody needs to pile into the stock, then he can take on some more debt and he buys more Bitcoin," Zeberg said.
He described MicroStrategy as "the largest house of cards we have seen in a long time" and warned that an unwind would be "really, really bad for people who think they can just hold on to it." The structure becomes particularly vulnerable if his predicted dollar surge materializes and Bitcoin enters "a really, really bad period."
Dollar Dynamics and Market Destruction
The US dollar serves as the fulcrum of Zeberg's thesis. He watches for a DXY bottom followed by a surge to 117-120 levels, which he calls "the wrecking ball" that will devastate risk assets globally.
"If we're going to see somewhat of a crisis, all this debt will need to be settled in dollars," Zeberg explained.
The greenback remains "still the cleanest shirt," despite getting "quite nasty." Dollar strength will create particular stress for entities with dollar liabilities and local-currency cash flows outside the United States.
This dollar surge will trigger what Zeberg expects to be a relatively brief deflationary bust lasting "six to nine months." The crash will be followed by policy panic and a subsequent stagflationary phase where "the tools of the Fed will become impotent."
Gold will initially decline during the liquidity crunch as investors sell to raise cash, potentially falling 33-35% similar to 2008 patterns. Silver could decline as much as 60% before policy responses drive a recovery. However, Zeberg projects gold reaching $35,000 per ounce "into the 2030s" as negative real rates and monetary reset dynamics reprice precious metals.
Crypto Project Survival and Market Structure
Beyond major cryptocurrencies, Zeberg predicts that "99%" of crypto projects will ultimately fail, with only those delivering real-world utility surviving the washout. He draws parallels to the dot-com crash, where companies like Amazon emerged stronger while speculative ventures disappeared.
The economist argues that "rampant speculation" has been prolonged by an era of easy money, creating unsustainable valuations across the cryptocurrency sector. Large-cap technology earnings concentration has "distorted" the market, and even quality small-cap tech companies face significant downside risk during an indiscriminate unwind.
He dismisses the concept of a single catalyst triggering the collapse, instead describing an environment that "becomes toxic" as high interest rates, falling real income, and climbing delinquencies pressure banks and corporations.
Front-end yields have begun to "break some levels," providing early warning signals for the transition.
Final Thoughts
Zeberg's framework envisions a final crypto surge driven by liquidity and momentum before dollar strength and tightening financial conditions trigger a comprehensive market collapse within six to nine months. The analysis suggests only utility-focused blockchain projects will survive the coming washout, while speculative investments face elimination in what he characterizes as the largest bubble in market history.