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Blomberg Report -Bitcoin is more likely to go up to $100,000 rather than go below $20,000

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Shivangi Mujumdar Follow

INDIA

Jun, 04 2021

Jun, 04 2021

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The investors of Bitcoin who take in the top hedge funds and money managers, are betting on the virtual currency. It could be more countable to as high as $100,000 in a year.  

 

It’s a wager that has drawn eye-rolls from skeptics who trust the volatile cryptocurrency. Crypto is a speculative asset rather than a store of value like gold. As of January, bitcoin has gained 160%, encouraged by strong institutional demand as well as lack of payment companies such as Square and Paypal purchase it on behalf of customers. 

 

Bitcoin has a watch for its all-time peak of just under $20,000 hit in December 2017. It debuted in 2011 at zero and was last dealing at $18,415. Success from $18,000 to $100,000 in one year is not a stretch, Brian Estes, chief investment officer at hedge fund Off the Chain Capital, stated. 

 

Estes forecasts bitcoin could hit between $100,000 and $288,000 by the end-2021 is based on a model. It says that it operates the stock-to-flow ratio determining the scarcity of commodities like gold. That model, he mentioned, has a 94% correlation with the price of bitcoin. 

 

Scarcity of Supply: 

 

Bitcoin relies on so-called “mining” computers that authorize blocks of transactions by challenging them to solve mathematical puzzles every 10 minutes. The first to answer the puzzle and clear the transaction is remunerated new bitcoins. 

 

Square’s PayPal and Cash App that has recently launched a crypto facility is about to do more than 300 million users. It has been scooping up all-new bitcoins, hedge fund Pantera Capital mentioned in its letter to investors on Friday. That has instigated a bitcoin shortage and has driven the rally in the last few weeks. 

 

Big Funds Buying:  

 

The so-called whale index, which totals addresses or wallets holding at least 1,000 bitcoins, is at an all-time high, mentioned Phil Bonello, research director at digital asset manager Grayscale. Bonello said more than 2,200 addresses were connected to large bitcoin holders, up 37% from 1,600 in 2018, suggesting that institutional money has been captured. Neo forecasts bitcoin to reach $60,000-$80,000 by the end of 2021. 


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Shivangi Mujumdar

CBW - External Analyst

INDIA

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