Bitcoin becoming the leading method for cross-border payments
Bitcoin and the entire cryptocurrency market have been under pressure from sellers over the past few days. The price of Bitcoin has set a new record of $ 24,000 per coin, more than doubling in the past few months.
Recognition of BTC as a mean of value accumulating
It is generally assumed that the recent rally was initiated by institutional investors and large companies such as Paypal. Although some analysts believe that bitcoin is overbought and may face some adjustments, the market generally shares an optimistic sentiment regarding Its long-term performance.
Garrick Hillman, head of research Blockchain.com, shares his opinion that Bitcoin could reach $ 54,000 in 2021:
“I expect Bitcoin to become a trillion-dollar asset as early as next year”.
Hillman’s forecast is based on a broader rollout led by institutional investors, with the number of people owning cryptocurrencies exceeding 100 million.
“I can easily believe that next year Bitcoin will be at the level of $ 50,000,” – shares this opinion of the famous hedge Fund Manager Michael Novogratz, saying that in the next few years, Bitcoin can eclipse gold.
Acceptance and acceptance from giant investors and wall street firms is the main driving force behind Bitcoin’s 2020 rally. Following the likes of Grayscale, Paypal and Square, UK-based Ruffer confirmed it had acquired around £ 550 million worth of Bitcoin, representing 2.7% of the company’s assets under management.
Bitcoin is one of the few things that has benefited from the pandemic. Concerns about the economic downturn and inflation have pushed many people to the BTC, which is characterized by a limited supply. Fed Chairman Jerome Powell recently said that higher inflation should be expected.
The liquidity crisis
Another factor that could push Bitcoin higher is the liquidity crisis. It is noted that the number of BTC stored on exchanges has sharply decreased since February. MicroStrategy just announced that it has acquired 30,000 Bitcoins. Now the leading bitcoin whale in AUM has 70,000 BTC. Chainalysis estimates that with whales accelerating their pace to buy more Bitcoins, there are currently only 3.4 million liquid coins available for investors.
Moreover, the filing for the Coinbase IPO will be a milestone for the entire industry, which will become mainstream and regulated. Ten years after its inception, Bitcoin is no longer a bubble haunted by computer geeks, but an asset that could become a global currency.
So is a rally in 2021 inevitable? 2020 is a year of uncertainty, and we still don’t know what the year ahead holds. One thing is clear-nothing good can be expected. Uncertainty will force people to better allocate their funds to hedge risks, so the value of Bitcoin is expected to gain higher recognition in the future.
However, Bitcoin is a highly volatile asset, so traders should be wary of huge price fluctuations and manage their positions. But high volatility gives a lot of opportunities for earnings. When trading with leverage, traders can open and sell crypto assets, while increasing their funds.