6 Bitcoin price predictions worth watching: $500,000 cap in sight?

It has become a fairly common prediction that the price of Bitcoin will reach $100,000 to $200,000 in the next 12 months.

Currently, Bitcoin is in a bull cycle, with a year-to-date increase of over 200% and outperforming the growth of most stocks in 2020.

But this round of gains seems to be different from the one at the end of 2017:

First, the historical high has been clearly broken;

Second, institutions are accumulating Bitcoin while much of the public is still on the sidelines.

“We are flooded with money and credit”

Predictions of Bitcoin reaching six-figure prices have become increasingly common during this bull cycle, with the accelerated expansion of central bank money as the primary driver.

When billionaires like Ray Dalio start to think about investing in Bitcoin and gold, it is also a phenomenon of diversification of "currency debasement".

“ We are in a state of awash in money and credit that is inflating the prices of most assets and distributing wealth in ways that we currently regard as unachievable under the normal system, and that is threatening the value of our money and credit. ”

He warned in a Dec. 8 Reddit thread:

“ It’s very likely that this flood will not recede, and even if assets are measured against currency depreciation, they will still be worth the same. But it’s important that we diversify across currencies and countries as well as asset classes. ”

Will Bitcoin reach $100,000-200,000?

As Cointelegraph reported in May, Morgan Creek CEO Mark Yusko said that BTC could exceed $100,000 in the next year or so. Bitcoin prices have more than doubled since May. But in the next 12 months, BTC prices still need to rise by about 300% to reach the expected six-digit figure.

The estimate echoes the predictions of the popular Stock-to-Flow (S2F) model, which its creator planB said is still correct. Last month, planB reiterated that he still believes BTC will reach $100,000 in December 2021 due to "supply shortage."

planB wrote last month:

“ People often ask me if I still believe in my model. To be clear, I have no doubt that the Bitcoin S2FX model is correct and that Bitcoin will reach $100,000-288,000 by December 2021. ”

According to reports, over the past month, Bitcoin has caught up with the average trendline of the S2F model.

A “conservative” $200,000-$300,000?

According to other analysts, the $200,000 price prediction is even relatively modest. Popular on-chain analyst Will Woo said that he now sees more evidence. At the same time, the supply of BTC on exchanges is also decreasing due to the previously mentioned Bitcoin inventory shortage.

BTC reserves of all exchanges, source: CryptoQuant

According to Woo, this would be a double whammy for the bears.

“ My top model finds a BTC value of $200,000 by the end of 2021 is a conservative forecast, and a value of $300,000 is not out of the question. ”

He continued in another post: “I have never been more optimistic about 2021. This reaccumulation phase coincides with physical market inventory drawdown at a level about twice as high as the previous cycle.”

$400,000 and More in “Digital Gold”?

The higher price predictions for Bitcoin come from the argument that “Bitcoin can challenge (or has already begun to challenge) and eventually replace gold as the de facto store of value.”

Interestingly, as Bitcoin surged to an all-time high in early December, significantly outperforming gold in 2020, some of the most bullish predictions came from the traditional financial sector.

In November, for example, a Citibank analyst said in a note to clients that Bitcoin could reach a high of $318,000 in 2021.

Citigroup executives currently believe that Bitcoin is in the middle of a bull market and looks like a "very clear investment channel", believing that the target price of Bitcoin should be set at $318,000 in December 2021.

Meanwhile, JPMorgan has also begun to point out that Bitcoin is becoming increasingly popular among traditional investors. In fact, the investment banking giant believes that Bitcoin has greater upside potential as "digital gold" than gold, which is already a "very mature" investment.

In a note to clients, the strategists said:

“ Institutional investors’ investment in Bitcoin has just begun, and Bitcoin investment is more beneficial to institutional investors than gold. If this medium- to long-term view proves to be correct, gold prices will suffer structural obstacles in the next few years. ”

Today, Bitcoin’s market value is less than 4% of gold’s. This huge upside potential has prompted other big-name investors to share their predictions that Bitcoin will reach a $9 trillion market value to challenge or even surpass gold.

Morgan Creek's Anthony Pompliano's Bitcoin price prediction remains around $100,000 in 2021. However, if BTC starts to catch up with gold's price in the summer, he will give a long-term target of $400,000. Meanwhile, Gemini exchange founders Tyler and Cameron Winklevoss believe that Bitcoin "is a better gold than gold," meaning a price rise to $500,000 is also very likely.

Cameron said that MicroStrategy and other investment companies buying large amounts of Bitcoin is just the beginning of a major shift. More importantly, Wall Street has already started a Bitcoin investment boom and Bitcoin will quickly become part of its "no-brainer" investment portfolio.

Finally he added:

“ What if every Fortune 100 or 500 company did this, and what if central banks started doing this? They haven’t even started doing this yet. ”

This article is a translation. Its content is intended for information transmission and does not constitute any investment advice.

Some pictures are from the original text.

Translation: Xia Yi | DaLing Think Tank

Original link: https://cointelegraph.com/news/top-6-bitcoin-price-predictions-to-watch-in-2021