Bitcoin is currently trading at $56k and could rally to $400k by year-end. This prediction was given by Bloomberg, one of the well-known data and financial services companies. This analysis is provided based on the fact that Bitcoin surged insanely during the rallies in 2013 and 2017. Reports say that Bitcoin gained 55x during 2013 and 15x during 2017 and such a similar growth means $400k is possible by year-end. So, don’t assume that since BTC has already gained more than 7x in the past year, it couldn’t do better.
The Bitcoin rally we are expecting!
Bloomberg has very well cleared out that past results don’t guarantee future gains but is definitely a reminder of what could happen. Every four years, when the halving happens, Bitcoin sees a massive rally, and the one for this year isn’t over yet. And, as the volatility of Bitcoin is dropping, such gains could become even more accessible. Even history suggests that when the volatility of Bitcoin has fallen, the price of Bitcoin has surged insanely. But there will be many hurdles along the way. Even the government could crack down on Bitcoin if it gets too close to replacing fiat. Ron Paul did say that the biggest possible threat to Bitcoin is the government. And just like it banned holding Gold, it could do that to BTC too.
If the rally happens, Bitcoin will get very close to replacing Gold. And will just be a little behind the market cap of Gold. But there are some real concerns regarding the price rise of Bitcoin. One of them is the increase in the prices of bonds that could lower the appeal of investing in cryptocurrencies. Remember the fall in the last week of February? It was the time when the US announced that the treasury yield has risen to 1.5%, 12 months high. But after that, Bitcoin did recover even though the yield rose to 1.77%. Even after all that, the returns of Bitcoin are much better than gold or anything else for that matter.
A Tweet said that if someone held onto Bitcoin from 2011, it would outdo the performance of the shares of Coinbase held for the same period. This shows how much the curreny has progressed and the kind of value it has gained over the years. And if the US approved a Bitcoin ETF, then we could see this monumental price target of $400k easily achieved. I say this because the price of Gold increased drastically when an ETF was introduced back in 2004, and since then, it has continued to rise. So, since we often measure Bitcoin and gold on the same scale, a similar performance could be expected.
What are your thoughts on the price target of Bitcoin and the rally Bloomberg talked about? And do you think that $400k is a realistic expectation? Let us know in the comments below. Also, if you found our content informative, do like it and share it with your friends.
Also Read: Chinese Bitcoin mining is threatening the environment.