Market players have been predicting Bitcoin’s rally in the coming months.
Bitcoin, which has been inching up higher in recent weeks, was finally able to breach the $16,000 and managed to sustain its gains. The token’s price hike naturally spawned a number of speculations with the more optimistic ones saying that BTC might eventually soar above $300K by next year.
The prediction came from Tom Fitzpatrick, Citibank Group’s Global head of Citifxtechnicals product, according to Bitcoin.com. In a report titled “Bitcoin: 21st Century Gold,” he said that the BTC rally could reach its peak in December 2021 at $318,000.
He acknowledged that while his prediction might appear improbable, such a price surge will actually be the weakest rally for the cryptocurrency. The report likewise noted that Bitcoin is known for its “unthinkable rallies followed by painful corrections,” a pattern that will likely continue in the future.
“Improbable though that seems it would only be a low to high rally of 102 times (the weakest rally so far in percentage terms),” Tom Fitzpatrick wrote in the report, according to Cryptonewsyes.com.
“Bitcoin is the new gold,” the report stated. Fitzpatrick believes that the digital currency’s price trajectory appears to be similar to that of gold in the 1970s.
Gold traded in the $20-$30 range for 50 years before structural changes were implemented in the 1970s. This resulted in a surge in the precious metal’s price as it established a new all-time high in August before trading at around $1,900 per ounce.
Companies have recently been acquiring Bitcoin as part of their treasury reserve due to fears that fiat currency might depreciate due to governments’ money printing activity in response to the coronavirus pandemic. For instance, Nasdaq-listed Microstrategy bought 21,454 Bitcoins (BTC) for $250 million in August, saying that it views the cryptocurrency as a “dependable store of value that is superior to cash in terms of appreciation potential.”
Tom Fitzpatrick is not the only one expecting Bitcoin’s price to rise to six-digit levels by December 2021. “People ask if I still believe in my model,” PlanB, author of the Bitcoin stock-to-flow (S2F) price model, wrote on Twitter on November 8. “To be clear: I have no doubt whatsoever that #bitcoin S2FX is correct and #bitcoin will tap $100K-288K before Dec2021.”
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