Well-known stock research analyst: By 2018, Bitcoin will grow 80% to $5,000, and ETH will double

After a thorough examination of digital currencies in July, independent equity research analyst Ronnie Moas has released the first two parts of his 122-page report on Bitcoin and other digital currencies.

Ronnie Moas, founder of Standpoint Research, said in the report:

“In my opinion, the genie is out of the bottle and cryptocurrencies will continue to rise, taking market share from stocks, other precious metals, bonds and currencies.”

“I think investors should take this opportunity and hold on for a few years. Even if you end up losing some money, at least you tried. In life, you will miss every opportunity you don’t take. Otherwise, it may be more frustrating to watch cryptocurrencies grow 10 times again.”

Moas gave a target price of $5,000 for Bitcoin in 2018, an increase of nearly 80% from $2,800 on Monday. He also predicted that Bitcoin competitor ETH will double in the next year, from the current $200 to $400, and another digital currency Litecoin may grow from $40 to $80.

In the next week or two, Moas plans to release the third part of the 122-page report, which will look at how the fourth-largest and smaller cryptocurrency could grow many times over in the near future.

The stock analyst said he has purchased 10 of the top 20 digital currencies by market cap to diversify his investments.

“In my opinion, 10-15 years from now, the top 20 cryptocurrencies in the chart below will look like the Amazon, Apple, Tesla, Facebook, Netflix, and Google chart we see today.”

Top 20 cryptocurrencies by market capitalization:

Moas’ report was released just before Bitcoin’s split on Tuesday, which has successfully hard forked to create a new altcoin, Bitcoin Cash (BCC). After the fork, Bitcoin holders will receive a free copy of BCC.

“The market is telling you that we’re going to get the fork done tomorrow,” Moas told CNBC on Monday, noting that bitcoin prices are approaching all-time highs.

The digital currency hit an all-time high of $3,025 in mid-June but has since fallen to around $1,837 in mid-July before rebounding to $2,800 as of Monday.

Back on July 5, Moas told CNBC that he had bought Bitcoin, ETH, and Litecoin. He expects Bitcoin to reach $5,000 in "a few months." He subsequently published a post on Reddit outlining his views on digital currencies.

Since then, institutional attention to Bitcoin has continued to increase.

On July 7, Fundstrat co-founder Tom Lee became the first major Wall Street strategist to publish a report on Bitcoin. Less than a week later, the Swiss Financial Markets Supervisory Authority approved the first Swiss bank to manage Bitcoin assets for clients, while the U.S. Commodity Futures Trading Commission (CFTC) approved the first Bitcoin options platform.

Last Tuesday, the U.S. Securities and Exchange Commission (SEC) also released a report concluding that securities laws apply to ICOs.

Moas wrote in his report:

“I have little doubt that 1% of cash, bonds, stocks and gold will end up in cryptocurrencies.”

Given that the current total market value of cryptocurrencies ($80 billion) is only 1/250 of the total value of gold, cash, stocks and bonds at $200 trillion, the size of digital currencies would need to increase 25 times to reach 1% of that.

If cryptocurrencies become part of asset allocation patterns and account for 2-4% of market capitalization, the digital currency market value could increase 100 times, Moas said.

Moas also cited a number of risks associated with investing in digital currencies, including inherent high volatility, large-scale hacks targeting cryptocurrency companies, and potential regulation, particularly in China, that could cause prices to “crash.”

Additionally, Moas pointed out the lack of consumer support for online digital currency products.

He stated in the report:

"Without phone support, you have to use the FAQ, which can take a long time to get an answer to your question - and then you may not be happy with the answer you get. The only other option is to email customer support, which can take 1-7 days to get a response."

Coinbase, a well-known American digital currency trading website, has been reported to have experienced loading delays or interruptions on its website in recent months, which has attracted a large number of customer complaints.

Overall, the stock analyst said he believes now is the time to buy digital currencies.

In the report, he describes how investors can buy Bitcoin and why financial institutions are interested in blockchain technology, the technology behind Bitcoin and other digital currencies.

Moas said:

“I’ve been watching from the sidelines for a few years and lately it feels like the blockchain train is leaving the station. I think we’re still in the first quarter of a four-quarter race and while I missed a lot of good opportunities to buy (2014-2016), it’s not too late to get in.”