Although Bitcoin price has cooled in the past few days and the leading cryptocurrency is currently at $ 32,000, it still boasts strong technicals and a 30-day price hike of almost 40%. Additionally, the top crypto has been still in the green for the past 12 months, showing a decline with the digital asset falling from its recently built all-time high of around $ 42,000 to its present value peak of nearly 300%.
In this regard, a number of traditional financial players have been forecasting big things for Bitcoin (BTC) since the fourth quarter of 2019, especially as governments around the world continue to print money in the form of “stimulus packages” Fears of increasing inflation, but also of an impending economic catastrophe, which could potentially lead to a global recession of unprecedented proportions.
For example, the United States economy declined at an unprecedented pace in the second quarter of 2020, with the gross domestic product of the global power plant, which outlines a country’s total production of goods and services, falling 31.4%.
In the wake of such developments – including an alarming rate of money being printed by central banks around the world – many investment houses and banking institutions are now seeing a future for Bitcoin, especially as a hedge against money inflation, despite the current volatility.
Many institutes see BTC at over USD 100,000
Earlier this year, the strategy team at American megabank JPMorgan Chase, led by Nikolaos Panigirtzoglou, claimed that a theoretical target of more than $ 146,000 for BTC could be sustainable by the end of 2021, which drives the narrative for which the digital currency is a prime candidate appears to replace gold as a long-term store of value, especially for an emerging base of younger, more tech-savvy investors.
Similarly, new data released by Pantera Capital, an investment firm and hedge fund, reaffirms JPMorgan’s view on BTC, suggesting that price action is closely in line with the stock-to-flow model, and reaffirming their trust in digital wealth, the $ 115,000 mark by August 1st.
The S2F model developed by PlanB examines BTC halving events that occur roughly every four years and how they play a direct role in increasing the value of the currency roughly six months after each cycle. In this regard, it can be seen that Bitcoin has shown remarkable growth after each of the three previous halves. For example, after halving in May 2020, the price of 1 BTC was $ 8,000, only to cross the $ 15,000 threshold after exactly six months.
Raiffeisen Bank also recently used the S2F model in a report to determine where Bitcoin could lead in the near future. According to the company’s research team, price targets that go beyond the $ 100,000 or even $ 1 million mark may be achieved. “The fact is that the value has more than tripled in 2020 and the momentum continues to be strong. Future further profits should not surprise us,” the study says.
Other prominent players in traditional finance who have projected big things for BTC in the short term include people like Andy Yee, director of public policy in Greater China at cross-border payments provider Visa, who believes this rally is different from the one in 2017, as this represents a shift from highly speculative, non-working tokens to Bitcoin and Ether (ETH).
Similarly, Thomas Fitzpatrick, global head of Market Insight product CitiFX Technicals at US financial giant Citibank, wrote in a private report leaked online that Bitcoin has the potential to go up to around $ 318,000 by December. Dollar scale.
Imaginative projections or imminent reality?
Although the S2F model was initially one of the few technical indicators that signaled the astronomical rise of Bitcoin, it now seems that more and more experts and analysts are realizing that BTC and other cryptocurrencies are making technological and monetary proposals.
Sam Tabar, co-founder of Fluidity – the company behind the AirSwap trading platform – and former head of capital strategy at Merrill Lynch, told Cointelegraph that everyone needs to remember that optimism about BTC at this point isn’t just fluff, like There is currently speculation backed by real substance, adding:
“Bitcoin is not governed by any person or government. Instead, it is governed by the simple laws of supply and demand. […] Essentially, Bitcoin is two sides of the same coin: on one side there is a global currency and on the other there is digital gold. “
As a proxy for a global currency, the friction of buying crypto has been significantly reduced as it is easier than ever to acquire bitcoin. Similarly, as the proxy for gold, Tabar believed that Bitcoin was being used as a hedge against the US dollar, especially as newly elected President Joe Biden seeks to boost US dollar spending to help the economy against the effects of COVID to support. 19 Locks.
J. P. Thieriot, CEO of the asset trading platform Uphold, told Cointelegraph that unlike traditional dollar depreciation ports like gold and other commodities, Bitcoin has no elasticity on the supply side.
He stressed that when gold hits $ 3,000, the marginal gold mines will catch fire again, with the same dynamics for oil and any other non-math unit of account. Thieriot believes that “the unique lack of elasticity on the supply side means that BTC will be priced more quickly to respond to the exact same drivers than things like gold.” He added:
“BTC is in the early stages of its introduction. It’s pretty logical to assume that inflows will increase as they transform from marginal to portfolio must-have. If I were a bookmaker I would say the over / under for midnight December 31, 2021 is … $ 85,000. “
After all, the ever-increasing institutional demand seems to be changing the market for digital assets, which in turn is causing many banks to make seemingly fancy price predictions regarding BTC. For example, more funds are now looking to get into the crypto game, and recently the American company Osprey Funds announced that it would launch its Osprey Bitcoin Trust over-the-counter crypto solution, which will likely compete with the Grayscale Bitcoin Trust.
Investor sentiment about BTC is high
When looking at market sentiment around Bitcoin, the digital currency increasingly shows correlations with the core functions that traditional fiat currencies traditionally provide for their users – that is, it has become a unit of account, a standard for payment deferrals, and ultimately a standard for Delayed payments a tangible long-term store of value.
As 2020 progressed, more and more e-commerce platforms began to support Bitcoin and other cryptocurrencies as a method of transaction for goods and services. For example, PayPal – a company with a 28 million merchant base – now allows users to buy, sell, and store cryptocurrencies through its platform.
On the subject, Paolo Ardoino, Chief Technology Officer of Crypto Exchange Bitfinex, told Cointelegraph that consumer sentiment about Bitcoin is overwhelmingly optimistic at the moment, and that people celebrating the rise of various altcoins and other off-chain solutions are enjoying their success Flagship Owe Crypto, Adding:
“The king of crypto is the basis for an emerging alternative financial system. Bitcoin provides a solid foundation for an amazing array of projects, some of which will fundamentally change the nature of money by the end of the decade. “
Thieriot believes the sentiment driving BTC can be attributed to a previously unseen currency deterioration caused by the monetary response to COVID-19. Beyond the speculation in retail, he believes companies are trying to hedge their fiat exposure. Obviously, they see some relative advantages of Bitcoin over traditional ports like gold and step in afterwards. “The early jumpers were amply rewarded, so the trend is likely to continue. ” he added.
Finally, Tabar highlighted that one of the most recent signs of growing consumer sentiment and institutional acceptance regarding BTC came in the form of recent filings from BlackRock, an American multinational investment management firm with $ 8.7 trillion in assets under management End of the year, entered 2020. A quick look at the records reveals that crypto-centric language is being used, alluding to the company’s funds that may enter into “Bitcoin-based futures”.