Bitcoin might hit $ 400,000 this 12 months as inflation fears the cryptocurrency is gaining momentum
NALYSTS at respected financial publisher Bloomberg became the newest and perhaps most unlikely bulls for Bitcoin today. A detailed report concluded that the cryptocurrency could reach a valuation of $ 400,000 (£ 290,000) this year.
The analysis, based on statistical modeling of the most recent data versus previous runs, suggests that the digital currency is “on similar ground” to 2013, when it rose 55x and 2017, when its value fell increased 17 times.
The report in the April 2021 issue of the New York-based media group’s Crypto Outlook 2021 stated, “To reach price extremes similar to those of these years in 2021, crypto would approach $ 400,000 based on the regression since the high of 2011. “
The researchers see the echoes of this year’s rally in those of the two previous big races, both of which took place about a year after the practice of “reward halving” on the Bitcoin blockchain – the vast digital network in which the asset is embedded.
This process takes place every four years to reduce the issuance of new shares by 50%. The last halving was in May.
The analysts wrote: “The year after a supply reduction [halving] is what 2021 has in common with 2017 and 2013, along with subdued volatility. “
Bloomberg also noted global indicators showing a “shift in the global tide” in favor of Bitcoin versus gold as a reserve asset, and Tesla’s decision to invest as factors to add weight to the digital asset among mainstream investors.
The moves, it said, bolster the currency’s reputation as a “potential global digital store of value” at a time of mounting uncertainty about inflation as the global economy returns to life after the pandemic.
It was also found that the value of institutional assets in publicly traded crypto funds rose from less than $ 10 billion in October last year to nearly $ 60 billion as of March 25.
“Despite the speculative excess in the broader crypto market, we believe Bitcoin is less prone to a sustained uptrend. The upcoming launch of Bitcoin-oriented US exchange-traded funds is another positive foundation, “the report said.
The currency rose by around $ 500 to $ 56,500 (£ 41,100). It was trading below $ 20,000 six months ago.