Bitcoin’s 2020 rally has stopped a bit – but the price of bitcoin could be ready to soar.
The bitcoin price, up over 30% since January 1, has been hovering around $ 10,000 per bitcoin over the past month.
Now, bitcoin could double to $ 20,000 before the end of the year, returning to its all-time high in 2017, according to bullish analyst Bloomberg.
Bitcoin has been treading water in recent weeks, with the price battling to break over … [+]
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“In the unlikely event of significant change for the worst, we expect the bitcoin price to continue to appreciate,” said Mike McGlone, Bloomberg’s senior commodity strategist.
“This unprecedented year of central bank easing accelerates the maturity of the firstborn crypto towards a digital version of gold, while tightening oversupply restrictions in most of the market.”
Unprecedented central bank stimulus measures and fresh quantitative easing are “helping independent value stores like gold and bitcoin,” McGlone found, with the bitcoin price potentially climbing as high as $ 28,000 this year.
McGlone also highlighted bitcoin’s strong rebound from its coronavirus-induced crash in March to less than $ 4,000 and the coronavirus pandemic accelerating the trend away from physical and digital currencies.
Meanwhile, a third bitcoin supply squeeze last month could be the catalyst for the bitcoin price to start climbing, according to McGlone.
In May, the amount of bitcoin awarded to those who maintain the bitcoin network, called miners, was cut in half – dropping from 12.5 bitcoin to 6.25.
Mike McGlone of Bloomberg thinks that “something really needs to go wrong for bitcoin not to appreciate.”
Bloomberg
“Bitcoin reflects the 2016 return to its previous peak,” McGlone said.
“That was the last time supply had halved, and the third year after a significant peak. After a 60% decline in 2014, by the end of 2016 the crypto was about the same as the peak of 2013. Fast forward four years and the second year after almost 75% decline in 2018, bitcoin will be approaching its record high of around $ 20,000 this year, in our view, if it follows the 2016 trend. “
Elsewhere, 2020 will see “increasingly favorable technical and fundamental bases” for bitcoin, with adoption, which McGlone considers to be bitcoin’s main metric, remains positive.
Bitcoin buy-to-hold interest from organizations like Grayscale, the world’s largest bitcoin investment trust, and growth in open interest bitcoin futures have boosted bitcoin maturity and helped ease volatility.
“Maturity, greater depth and sufficient future exposure should continue to prevent the volatility of the firstborn crypto, while keeping it oriented towards price appreciation,” according to McGlone.
However, bitcoin seems to be “breaking away” from the broader cryptocurrency market.
“We see very little upside in the [ethereum] price absent a rising tide of bitcoin, ”McGlone said.
“The leading crypto breaks away from the package in terms of adoption and is backed by macroeconomic conditions almost ideal for stores of value in the midst of quantitative easing.”
The price of bitcoin is currently around half its $ 20,000 per bitcoin high but some think it could … [+]
Coinbase
McGlone’s analysis echoes others who are seeing bitcoin climb this year, with a “fourth crypto cycle” possibly approaching.
“The 2017 cycle spawned dozens of exciting projects in a wide range of areas including payments, finance, games, infrastructure, and web apps,” partners Andreessen Horowitz, Chris Dixon and Eddy Lazzarin wrote in a blog post last month.
“Many of these projects are launching in the near future, possibly driving a fourth crypto cycle.”
The bitcoin and crypto community was set on fire last month by legendary macro news investor Paul Tudor Jones buying bitcoin as a hedge against the inflation he sees coming as a result of unprecedented central bank currency printing, saying that bitcoin reminded him of the role gold played. in the 1970s.
Earlier this week, one of the most watched bitcoin analysts, an unnamed strategist who claims to be a member of an institutional investment team that manages about $ 100 billion in assets, released an update to this and known as stock-to-flow. model, suggesting that the price of bitcoin could be about to surge to around $ 100,000.