Bitcoin will break new records in 2019
Bitcoin price forecast 2021: clearly strong, but to what extent?
The year 2020 will soon be over and Bitcoin price forecast 2021 is becoming more and more interesting for crypto traders. Everywhere in the net you come across headlines such as “Bitcoin on the way to a new all-time high” as well as optimistic views of numerous analysts who set high price targets for BTC in the coming year.
Future Bitcoin price prediction ranges from $ 100,000 from the stock-to-flow (S&F) forecasting model to $ 170,000 from Bloomberg strategist Mike McGlone to $ 318,000. The latter goal is prophesied by Tom Fitzpatrick, the Citibank analyst who called Bitcoin "the gold of the 21st century".
Will Bitcoin Really Go That High? To get a clearer picture about Bitcoin price analysis, let's take a look at the major BTC price drivers and try to create the Bitcoin forecast which will hopefully help you make a right trading decision.
Bitcoin forecast: where is the current price?
Bitcoin has already shown us that its price could soon set new records. One cannot avoid mentioning the extraordinary performance of the “Forever-Number-One” cryptocurrency.
The end of November 2020 surprised traders with Bitcoin's steady rise to $ 19,000. In less than two months, Bitcoin has appreciated 90 percent in value, climbing from $ 10,400 on October 1 to $ 18,900 on November 21, 2020. Bitcoin's market capitalization recently peaked at $ 337 billion, beating the previous record of $ 328 billion in December 2017.
The cryptocurrency is hovering near the $ 20,000 mark for the first time in three years. If it manages to break this difficult psychological milestone, traders should have a detailed Bitcoin prediction to identify the best entry opportunity.
Major factors that can help Bitcoin break a new record include growing institutional demand, a break above $ 18,500 (a strong resistance level), and reduced selling pressure.
The pressure to sell is easing
Typically, when Bitcoin holders want to sell BTC, they first need to make a deposit on exchanges. When the Bitcoin exchange registers a decline, it usually means that there is low pressure on the sell side in the market.
According to Glassnode, the Bitcoin balance on the exchanges fell 18 percent year-to-date, suggesting that Bitcoin's liquidity is falling.
In a broader sense, this data shows that Bitcoin holders will not sell their BTC at the current price level, even though the price has risen from $ 3,600 to $ 18,800 in eight months.
The demand from institutional investors is increasing
According to BlackRock's Chief Investment Officer for Fixed Income, Rick Rieder, "[Bitcoin] is here and will stay". In his interview with CNBC, Rieder highlighted that Millennials are open to cryptocurrencies and digital payments, which is a good reason for the adoption of bitcoin is.
JP Morgan shares Reider's view that Bitcoin can "largely replace gold". Bitcoin is facing a "significant" uptrend as it competes with gold as an alternative currency, according to JPMorgan's October 2020 comment: "Even a modest displacement of gold as an" alternative "currency in the longer term would double or triple the price of Bitcoin ".
Supporting millennials can accelerate further adoption of Bitcoin and strengthen its status as a means of payment and a symbol of wealth.
Galaxy Digital CEO and billionaire investor Mike Novogratz has analyzed institutional trends and believes the 2020 Bitcoin boom will be driven by institutional buy-ins and investors looking to hedge against traditional paper money.
Bitcoin is now an institutional asset. Period. The good thing is most institutions aren't in yet. It's why 2021 will be as good or better than 2020. $ GLXY. $ BTC. https://t.co/rPbWnpE00i- Mike Novogratz (@novogratz) November 20, 2020
New Bitcoin Adepts: PayPal, Square and Fidelity Investment
In October 2020, the international payment service provider PayPal enabled its customers to sell and buy Bitcoin and other cryptocurrencies directly from their accounts. According to Bloomberg, 26 million merchants from the PayPal network started accepting cryptocurrencies. The payment service Square also decided to keep some of its cash in Bitcoin. The company bought 4,709 Bitcoin for $ 50 million. That money represents nearly one percent of Square's total net worth as of the end of Q2 2020.
Earlier this year, one of the world's largest asset management companies, Fidelity Investments, with $ 3.3 trillion in assets, announced the creation of its first bitcoin mutual fund.
These are just three examples of the latest bitcoin adoption among institutional investors.
Bitcoin's price breaks above 18,500
As Bitcoin breaks through one level at a time, confidence increases that enough momentum has been created in the market to break through critical resistance levels.
On November 18, Bitcoin plunged from $ 18,500 to around $ 17,200 just minutes after hitting its two-year high. A few days later, Bitcoin posted another multi-month high of around $ 19,000.
Bitcoin price forecast 2021
It's a rare occurrence when analysts' Bitcoin predictions are so unanimous. While the price targets for Bitcoin value differ, everyone seems to be very optimistic about the future of BTC / USD in 2021.
Tom Lee, managing partner of Fundstrat Global Advisors, supported the view that Bitcoin will replace gold as a hedge against inflation and investment. In an interview with Yahoo Finance, Lee said:
Bitcoin prediction: $ 65,000, $ 100,000, $ 170,000, or $ 318,000
How much will Bitcoin go up?
BTC Prediction # 1: $ 65,000 by Mike Novogratz
The billionaire investor expects the Bitcoin price to climb to $ 65,000, suggesting 2021 is a good time to get started. He believes Bitcoin will break the $ 20,000 mark. Then the price could fall back to around $ 16,000 before jumping to over $ 60,000 by the end of 2021 as a result of the "network effect" with a lot of new buyers and lower Bitcoin supply.
Novogratz expects Bitcoin scarcity to skyrocket its price in the coming years as Bitcoin holders increasingly view it as an investment rather than a purely speculative asset.
Bitcoin price prediction # 2: $ 100,000 from the S2F creator
According to the creator of a popular stock-to-flow (S2F) model using the Twitter name "PlanB," the benchmark cryptocurrency will hit $ 100,000 by December 2021.
The S2F model calculates the expected Bitcoin price in 2021, taking into account falling supply and increasing demand. As Bitcoin is halved every four years, the supply gradually decreases and inflation rises. In theory, this could boost demand for Bitcoin and lead to a drastic increase in the price of BTC.
During the second halving in July 2016, Bitcoin price hovered around $ 640. Seventeen months later, Bitcoin soared to its all-time high of $ 20,000. Should the scheme repeat itself, Bitcoin can rise from $ 100,000 to $ 288,000 by December 2021.
Current #bitcoin price action is nice, but we are waiting for a real jump (like the red arrows early 2013 and 2017). IMO that will be the start of the real bull market, and indeed phase5. January 2021? pic.twitter.com/orzwdCOcvP- PlanB (@ 100trillionUSD) November 22, 2020
BTC / USD forecast # 3: $ 170,000 from Bloomberg strategist
Mike McGlone, an analyst at Bloomberg, shared another upbeat Bitcoin price prediction for 2021. Believing the upward movement of the cryptocurrency is not over yet, he sets the level of $ 170,000 for the 2022 BTC price target.
"If you look at historical performance that can have a potential future impact, the next year or two should add an extra zero to the price," said McGlone. If Bitcoin ended at $ 7,000 in 2019 and is currently trading for $ 17,000, it could potentially happen again, so the price is $ 170,000.
Bitcoin Price Prediction 2021 # 4: $ 318,000 from Citibank analyst
To draw a positive conclusion, let's take a look at the bullish forecast recently released by Citibank analyst Tom Fitzpatrick. He believes Bitcoin will skyrocket to $ 318,000 in 2021.
But why is Citibank's senior analyst prophecy so optimistic? His forecast is based on the historical Bitcoin price development. Remembering the exponential growth in the price of Bitcoin in 2010 and 2011, Fitzpatrick expects a similar move in 2021.
He also mentions that during the period of increased inflation caused by Fed intervention and near-zero interest rates to reduce the impact of the coronavirus pandemic, cryptocurrencies are seen as both inflationary protection and a safe investment.
Only time will tell us whose Bitcoin price prediction for 2021 was correct. In any case, experts seem to agree on the outstanding prospects for Bitcoin in the next 12 months.
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