June 23, 2022: -If crypto’s past bubbles are anything to go by, bitcoin could fall much further.

According to one strategist, the top cryptocurrency in the world is likely to tank as low as $13,000, a nearly 40% drop from current levels.

“We would still be selling these ways of cryptocurrencies into this environment,” Ian Harnett, co-founder and chief investment officer of Absolute Strategy Research, told CNBC on Tuesday.

“It is a liquidity play. We’ve found that it’s neither a currency nor a commodity and certainly not a store of value.”

Harnett explained his bearish call; past crypto rallies show bitcoin tends to decrease roughly 80% from all-time highs. In 2018, for instance, the cryptocurrency was closing to $3,000 after reaching nearly $20,000 in late 2017.

According to Harnett, such a drop in 2022 “would take you back to about $13,000,” a “key support area” for the token. Bitcoin rose to a record high of almost $69,000 at the height of the 2021 crypto frenzy.

“In a world where liquidity is fruitful, the bitcoins do nicely,” Harnett said.

“When that liquidity is taken away, and that’s what the central banks are doing now, you see those markets come under extreme pressure.”

The crypto world is on the border as investors grapple with the impact of higher interest prices on assets that grew in an era of ultra-loose monetary policy.

Last week, the Federal Reserve increased its benchmark lending rate by 75 basis points, its most significant single hike from 1994. The Fed’s decision was followed by a few moves from the Bank of England and the Swiss National Bank.