BITCOIN GOES FOR $ 400,000 ?
Two days ago, the New York agency Bloomberg published its monthly issue "Prospects of cryptocurrency", which deals with the growth of bitcoin demand.
According to Bitcoin magazine, the report is strikingly "bullish" (the bull market is a period in stock market terminology when prices are mostly rising), especially when you consider that it is signed by a reputable company in the financial and media spheres.
Here are some of the most notable views from the Bloomberg report:
According to analysts at the New York company, the gradual acceptance of bitcoin affects human nature, which tends to support the rise of cryptocurrencies, so fund managers are reluctant to cross the Rubicon and invest at least part of the funds in it, while the price of bitcoin grows in an environment of unprecedented low asset values.
Over the past year, record low bond yields during the pandemic have played an important role in bitcoin acceptance, to which more and more investors are paying attention.
Bloomberg also points out the contrast between the recent movement of the price of bitcoin in relation to gold, so he says in relation to gold, cryptocurrency has a basis for reducing instability - the amount of bitcoin is limited.
- Acceptance in the mainstream and higher prices increase the depth, which suppresses volatility and risk, Bloomberg writes.
The report repeatedly emphasizes the superiority of bitcoin as a monetary asset in the digital economy over gold. Although the outlook for gold is not "bearish" (the bear market is synonymous with stock market declines over time), value and price data lead Bloomberg to conclude that bitcoin is replacing its monetary predecessor as a more desirable non-sovereign reserve currency in investor portfolios.
- The proverb that 'money goes where it's better' best describes what we see when companies support the growth of bitcoin prices. That does not necessarily mean a drop in the price of gold, but most indicators show a change in the global tide of money towards the new digital currency as a reserve asset, the New York agency claims, and Bitcoin magazine reports.
- Bitcoin's attitude towards gold is similar to 2016, when the brightest metal reached close to 1,400 dollars per ounce, and the cryptocurrency was launched to its maximum in 2017. The key difference this time is that bitcoin is worth less and less speculative, thanks to greater acceptance. The world's largest manufacturer of electric vehicles by market capitalization (Tesla), by announcing that it will diversify a part of its assets into cryptocurrency, enabled bitcoin to cross the threshold of 40,000 dollars, Bloomberg writes in its edition.
It points out that analytical models show that the amount of bitcoin on the stock exchanges is decreasing, despite the bull market, which is the opposite trend compared to the bull market in 2017. The report states Bloomberg's estimates that bitcoin follows a path similar to the one from 2013 and 2017, and the charts indicate a possible price of as much as $ 400,000.
In any case, logarithmically, the movement of the price of bitcoin over the years is an incredible challenge for investors in the current economic environment.