Bitcoin price news: Will BTC hit $50K? ’Safe bet price will climb’ but expect ‘setbacks’
Bitcoin sees price surge following Elon Musk endorsement
When you subscribe we will use the information you provide to send you these newsletters.Sometimes they’ll include recommendations for other related newsletters or services we offer.Our Privacy Notice explains more about how we use your data, and your rights.You can unsubscribe at any time.
Despite shrill celebrity endorsements by figures such as Elon Musk on social media, threes factors have been more quietly driving the crypto price north. Electric car manufacturer Tesla last week announced it had invested $1.5billion (£1.08billion) in bitcoin.
America’s oldest bank BNY Mellon swiftly followed, confirming it would start holding and transferring cryptocurrencies for asset management clients.
I think it is at this point a safe bet that the price will generally continue to climb throughout the year, with some setbacks along the way
Uphold CEO JP Thieriot
But arguably most important of all is the unprecedented economic situation triggered by the coronavirus pandemic.
JP Thieriot, CEO of digital money platform Uphold, believes this “new normal” is the catalyst for bitcoin going mainstream.
He told Express.co.uk: “After 2020, professional investors are looking out at the equities market and not loving what they see.
“Sure, there are some sectors doing better than others, but uncertainty is everywhere.
“Gold and other metals are doing okay, but cryptocurrency is beginning to look like a more profitable bet than most.
“This has everyone from investment firms to hedge fund managers rethinking the notion of putting some of their portfolio behind digital assets, and this trend is likely to just increase further in the coming years.
“On top of this, there are plenty of retail investors who will only really have faith in cryptocurrency once they see the big names getting into it, so I expect a surge to come from there, as well.
“And all of this, of course, will continue to be fuelled by unprecedented currency debasement in the fiats.”
And while refusing to predict when bitcoin will top the psychological $50,000 (£36,000) barrier, the expert suggests it should only be a matter of time.
He said: “I don’t have a personal prediction, but I believe the stock to flow model that is being used by [hedge fund] Pantera Capital has been shown to be fairly accurate, historically.
“The model is basically based around the ratio of existing bitcoin, or stock, to the rate of production, or flow.
“With each halving, this ratio changes and the price has, so far, always risen after this change.
DON’T MISS
Brexiteers LASH OUT after Macron-ally launches vaccine attack on UK [INSIGHT]
Meghan Markle pays tribute to firstborn Archie with poignant choice [ANALYSIS]
BBC Weather: Europe to be battered by ‘snow and ice’ – VIDEO [FORECAST]
“In any event, the model predicts approximately a $50,000 valuation coming around March, and we aren’t actually far from that price right now.”
The stock to flow model he is referring to is predicting the digital asset may top $100,000 by the end of the year.
Mr Thieriot added: “Generally speaking, I see 2021 as a year where institutions will continue to become more heavily involved in digital assets, in a variety of ways.
“Expect new announcements on companies either investing in existing cryptocurrencies or developing their own.
“I think it is at this point a safe bet that the price will generally continue to climb throughout the year, with some setbacks along the way.”
He added how one thing can be said with more certainty is social media hype is only felling volatility on the crypto markets.
Mr Thieriot said: “Right now, a lot of the hype happening in the market is just that: hype.
“With the recent events around WallStreetBets and GME, followed by public support from Elon Musk for both bitcoin and dogecoin, it’s no surprise we have a wave of young people who are excitedly jumping on board the bandwagon.
“That isn’t to say the recent pumps we have seen in cryptocurrency will or won’t hold; it’s just to say that we may see some decrease in short-term volatility as we move away from these moments, assuming they don’t become a perpetual ‘new normal’ – which they might.
“Public fora acting concertedly on public information is an interesting conundrum.
“It distorts markets, but it’s done in plain daylight and has a sort of egalitarian zeitgeist.
“If I were a hedge fund, I’d certainly be adding a variable the next time I consider shorting a brand that might be sentimental for millennials.”
However, the Financial Conduct Authority (FCA) has warned earlier this year against investing in cryptoassets.
The Financial Conduct Authority branded cryptos like bitcoin and ethereum a high-risk investment.
The FCA said: “If you invest in cryptoassets, you should be prepared to lose all your money.”
Source: Read Full Article
