A top Bloomberg analyst is predicting a rise in Bitcoin prices that will rival its rapid spike in 2013.
Bloomberg Intelligence senior commodity strategist Mike McGlone cites the fact that Visa, Goldman Sachs and Morgan Stanley have embraced the digitalization of money as signs that Bitcoin could replace gold as the global digital-reserve asset.
“Bitcoin adoption has become more sudden than gradual and is likely to accelerate, as we see it, underpinning its price for the foreseeable future and magnifying the dollar’s dominance as the reserve currency.”
McGlone also points to Tesla, the world’s largest automaker in terms of market cap, allocating some of its assets to Bitcoin as another example of general adoption.
“We see a rising tide from institutions and individual investors lifting Bitcoin. It appears the narrative has tilted toward allocating a small portion of assets toward the crypto vs. the risks of missing out on the potential for Bitcoin becoming the global benchmark digital asset.”
McGlone says his current models show BTC could reach a staggering $400,000 this cycle.
“The technical outlook for Bitcoin in 2021 remains strongly upward, if past patterns repeat. Common companions for strong annual rallies in the first-born crypto – low volatility and halvings – are aligned favorably.
Our graphic depicts Bitcoin on similar ground as the roughly 55x gain in 2013 and 15x in 2017. To reach price extremes akin to those years in 2021, the crypto would approach $400,000, based on the regression since the 2011 high.”
The analyst says crypto payments to merchants are also on the rise in another sign of mass adoption.
The increase is thanks in part to global Covid-19 lockdowns and lower crypto transaction fees.
“Global crypto payments leaped toward $1.6 billion in 1Q. To minimize distortions from Covid-19 lockdowns that began about a year ago, we show the four-quarter average increased about 60% to just over $1 billion from $640 million in 1Q20.”
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