This year alone, Bitcoin’s value has jumped 150%. That means its growth in 2020 has far outpaced the same period in 2017. Just hours ago, Bitcoin broke through the $19,000 mark and continues to climb.
Many economic experts say the cryptocurrency market has matured significantly over the past three years.
What’s different about Bitcoin now compared to before?
Mati Greenspan, portfolio manager and founder of Quantum Economics, explained: “The main difference between now and 2017 is that back then, the market was driven by retail speculation. Now, it’s driven by corporations and billionaires.”
For example, Wall Street financial firm Fidelity launched a new division allowing clients to invest in digital assets, while PayPal recently started letting US users buy, hold, and sell various cryptocurrencies.
Big-name investors have also jumped into Bitcoin, including hedge fund billionaires like Paul Tudor Jones, founder of Tudor Investment Corporation, and Stanley Druckenmiller, chairman of Duquesne Capital.
Antoni Trenchev, managing partner at crypto lender Nexo, said: “It’s no surprise these big players are involved. They buy quietly, but once Bitcoin hits the treasury, the whole world will know, similar to how the gold market surged in the 1970s.”
The key factor here is the Covid-19 pandemic. Crypto fans compare Bitcoin to safe-haven assets like gold, which investors flock to during economic uncertainty. They believe Covid-19 stimulus measures have made traditional currencies like the US dollar less attractive.
Where is Bitcoin headed?
There are plenty of bold predictions about how high Bitcoin’s price could go soon and in the long term. Many crypto enthusiasts agree Bitcoin is likely to break its all-time high soon.
Greenspan said: “A new all-time high isn’t just possible, it’s expected by Bitcoin believers any day now.”
Pascal Gauthier, CEO of crypto hardware wallet maker Ledger, believes this latest Bitcoin rally will last longer than the previous one.
“Bitcoin has gained recognition and a place in the market. Now it’s becoming a mainstream currency,” he said. “2021 will be exciting and still focused on building great products and technology, but this time the wind is at its back.”
Some crypto speculators have made daring forecasts about Bitcoin’s next price target. Mike Novogratz, CEO of investment firm Galaxy Digital, predicts Bitcoin could reach $55,000 to $60,000 by the end of the year, though he also once said it could “easily” hit $40,000 by the end of 2018.
A word of caution
Cryptocurrency is known for its volatility. It plunged to a low of $3,122 in 2018 before soaring near $20,000 last year. Just last week, Bitcoin jumped over $2,000 to reach $19,348 (about 447.9 million VND).
Soravis Srinawakoon, CEO and co-founder of crypto software firm Band Protocol, says it remains to be seen if Bitcoin can hit a new high by year-end.
“Over time, Bitcoin’s story is strengthening, though global confidence in its payment capability hasn’t fully materialized,” he added. “This has led to ongoing asset volatility.”
Still, there is widespread optimism about this digital currency’s future. Trenchev, who predicted earlier this year that Bitcoin could reach $50,000 (over 1 billion VND) by the end of 2020, says “there’s growing evidence supporting that price trend.”
Srinawakoon added: “All signals strongly support the next wave and new users coming soon.”
Source: CNBC
