Last week saw CoinList CEO Graham Jenkins declaring that the value of Bitcoin would hit the $100,000 mark by the end of 2021. The legendary cryptocurrency already set a record high of $66,000 in late October and there’s every indication that the demand for Bitcoin is only going to get more intense.
The new wave of bullish optimism comes after the highly publicized launch of the US Bitcoin futures ETF. In addition to this, the prevailing conditions pointing towards inflation suggests that more investors may seek to buy Bitcoin for the first time. While some of the value of the crypto has been lost since then, there’s every hope that this could be yet another record-breaking year for Bitcoin.
What’s interesting is the fact that growing numbers of investors are starting to see Bitcoin as an ‘inflation hedge’ rather the traditional commodity of gold. This marks a startling change in the perceptions of how the cryptocurrency is being perceived by the world of finance.
As such, companies ranging in size from massive corporations to family businesses are starting to save some of their excess cash in Bitcoin inflation hedge. This is because there’s a widespread belief that inflation is here for much longer than the short-term and a Bitcoin investment would be one way to outpace the inflationary growth. Plus with the ProShares Bitcoin futures ETG getting the perfect launch, it’s given the crypto a positive send-off to what’s been a dramatic year.
Why Bitcoin might not be ready for $100,000 just yet
Bitcoin has long attracted plenty of skepticism from the financial world. From the likes of the JP Morgan Chase CEO saying that the cryptocurrency is ‘worthless’ to major mortgage lenders like United Wholesale abandoning plans to take Bitcoin payments, there’s something about this crypto that scares traditional industries.
In addition to this, Bitcoin has experienced no shortage of volatility over the past year. With several altcoins like Shiba Inu and DogeCoin creating inexplicable competition, it means that Bitcoin is going to have to work twice as hard to cross the $100,000 mark. Bitcoin has also been hit by the rapid success of Ethereum. This cryptocurrency has found favor thanks to its use in non-fungible tokens. Whether this craze for digital assets is a passing fad or something more permanent is hard to tell, but with a major upgrade in the pipeline, it’s looking like Ethereum is becoming a real match for Bitcoin.
However, Bitcoin has a history of experiencing a repetitive cycle in its value. From the $65,000 value reached in April 2021, it seemed inevitable that there would be the crash that wiped half of the value. As such, there have been many investors who are seeking to understand how such cycles work and predictions have even been made that Bitcoin could be worth $250,000 in just five years. All of which means that Bitcoin’s rapid recent growth could be just another example of how this crypto is capturing the world’s imagination.