Bitcoin surged above the $52,000 level, a record high on Wednesday at around 2:45 p.m. ET. According to Morgan Creek Digital Asset cofounder Anthony Pompliano, Bitcoin could rise to $1 million over the long term to become a global reserve currency of the internet generation.
Bitcoin influencer, Tone Vays, echoed sentiments by stating that bitcoin is set to reach a record-breaking high of $300,000 this year itself.
In another report, Mike Novogratz, CEO of Galaxy Digital Bank dedicated to cryptocurrencies, agreed with the upward graph of bitcoin and said that it would climb up to $ 100,000 by the end of this year.
According to business reports, investment in BTC is one of the best ways to hedge against inflation. In the traditional banking system, the money is printed after the upvote from the regulatory body. In contrast, bitcoins have a cap of 21 million bitcoins which makes them rare, just like gold, fuel, etc. This explains the soaring prices.
Bitcoin’s rise beyond $50,000 for the first time has caused a wave of HODLing as in the buy-and-hold strategy that is driving Bitcoin higher and the cryptocurrency’s inevitable volatility in the future. Factors behind the rise include the large participation from institutional and retail investors. Companies like MicroStrategy, Grayscale, and Tesla have recently joined the Bitcoin market by investing $ 250 million, $600 million, and $1.5 billion, respectively, and have created a stir in the market. The Bitcoin Market has seen involvement from Big names like the Financial services company Square Inc. bitcoin investment last October and Elon Musk’s electric carmaker Tesla purchase of around $1.5 billion in bitcoin.
Charlie Morris, Chief Investment Officer at ByteTree Asset Management Company, stated that the bitcoin price would reach the $1 million mark between 2036 to 2044.
Bitcoin’s price is also influenced in part by the value of the US dollar index, which slipped to 6.8% last year and continued to fall this year. Many payment service providers like Paypal have extended their services to ease Bitcoin trading. This has motivated many retail investments. Surprisingly Bitcoin’s biggest critique, the banking system too, has embraced bitcoin. Banks in Russia, China, Canada, and the EU are ahead in the race and may eventually launch their own cryptocurrency. To some investors, Bitcoin’s latest ascent is reminiscent of its phenomenal surge to nearly $20,000 in 2017. This, unfortunately, was followed by a huge plunge the following year, in which the cryptocurrency lost 80% of its value.
But the world’s most valuable cryptocurrency has since staged a fierce comeback, more than quadrupling in 2020 and rallying over 70% this year. Skeptics, however, are concerned that the bitcoin rise may be the biggest market bubble in 2021.