Tesla’s recent declaration that it will no longer accept Bitcoin (BTC), as well as the bearish statements of its CEO Elon Musk, have hardly shaken the security of investment research firm Fundstrat Global Advisors. The New York-based advisory firm has raised Bitcoin’s price target to USD 125,000 for 2021, up 25%.
“I don’t think it will make people think negatively about Bitcoin, but it will make people focus on the problems posed by digital assets.” Tom Lee, Managing Partner of Fundstrat, told Business Insider. “It is probably better to think of it as a call to action for the bitcoin industry to focus on renewable energy or more efficient ways to prove the work.”
Some of his previous predictions were either too bullish or too bearish.
In both cases, he said it was possible that Musk was influenced by people within his organization.
“A lot of people come to Tesla because it’s ESG-friendly.” Lee was referring to the environmental, social and governance criteria that have been reviewed by some investors. “I think some of these people were just wondering if you’d like to accept a digital currency. Maybe it shouldn’t be Bitcoin.”
Tesla said last week that they are “concerned that the use of fossil fuels for bitcoin mining and the transaction, especially coal, which is the worst emissions of any fuel, is growing rapidly”. The day before, Reuters reported Tesla is aiming to enter the multi-billion dollar US renewable credit market in hopes of capitalizing on the Biden government’s march toward new zero-emission goals.
Lee also said he is unwavering by Bitcoin’s dwindling dominance, or percentage of total market cap, which is currently hovering around 40% according to various data providers. At the beginning of this year it was around 70%.
“Bitcoin dominance will actually increase during a bear market.” Lee was quoted as saying.
In its April analysis, Fundstrat estimated The price target for this Bitcoin for this year was USD 100,000.
One of the reasons Fundstrat’s forecast was that companies would enter the crypto market on a larger scale in 2021.
“We believe this is increasingly happening and will be a new source of capital flows into the crypto-economy.” the company said. “Even if Facebook hasn’t bought Bitcoin, companies are coming, and this may not be reflected in earnings reports just yet.”
Jack Dorsey-run place Approved that their BTC strategy has not changed and that they are “deeply committed to this community, including working on a greener future through our Bitcoin Clean Energy Initiative”. The company said it continues to “continuously” evaluate its Bitcoin investment. In February, Square announced it had spent $ 170 million on BTC.
According to Justin Chuh, senior trader at Wave Financial, digital asset investment manager, there is still “gravity and volatility” in the crypto market.
“When we combine fundamentals like positive net inflows from BTC to exchanges mixed with the aforementioned lower high and lower low technicals, we can ignore what big egos and influencers are saying and see that a pullback would inevitably occur. But we have to accept that those voices chirping on social media cannot help and actually take action. That’s healthy, but I think we all wish this didn’t happen. “ he said in a comment sent via email.
At 11:23 UTC, BTC is trading at USD 44,610 and is down 9% in one day and 23% in one week.