Cryptocurrency investors are enduring tough times, with altcoins suffering pain for nearly 70 days. While fluctuations in Bitcoin 
$108,883 prices are not massive, losses in altcoins are significant. Now, a grim forecast from Bank of America has emerged, raising concerns that affect not only the U.S. stock market but cryptocurrencies as well.
Historical Major Crash in Markets
While major upheavals like this in cryptocurrencies are common, they are rare in the global financial system. Bank of America’s strategists recently highlighted a 40% risk of a significant drop in the S&P 500. In their analysis, they drew comparisons between the current market scenario and the notorious “Nifty Fifty” and “dot-com” bubbles of the 1960s and late 1990s.
Experts, noting the similarities between the two periods, are warning of an impending crash. The report focuses on the share of the top five stocks in the S&P 500, which accounts for 26.4%, raising alarms compared to the rest of the world. Jared Woodard from Bank of America stated that passive investment plays a crucial role in this market concentration.
“Passive funds dominate with a 54% market share.”
Prominent figures like Mike Wilson from Morgan Stanley and David Kostin from Goldman Sachs predict largely flat returns for the S&P 500 over the next decade. Bank of America suggests exploring alternatives less correlated with the so-called magnificent seven top stocks.
Impact on Cryptocurrencies
A probable decline of more than 40% could occur. DeepSeek has already significantly impacted the NVIDIA segment of the magnificent seven. The decline in technology stocks is fueled by tangible evidence that substantial deals can be done at much lower costs. This risk continues to loom ominously, whether today or tomorrow.
As the Bitcoin community strays from Nakamoto’s philosophy, BTC is increasingly treated like a tech stock. This indicates that in the event of a major crash, Bitcoin could lead to a significant downturn in this bubble as well. Time will reveal if the analysts are correct, but investors are eager to experience a genuine bull market in cryptocurrencies before the end of the year.
