We’ve been here before, three years ago. Around these dates, exactly, Bitcoin surpassed a yearned All-Time-High (ATH) with a price over $20.000 and a market capitalization around $334B. Now, we’re seeing a new record: $20.836 per unit according to CoinMarketCap, and $20.815 per unit registered by CoinGecko.
Besides, the market capitalization it’s higher as well, with over $384B. That is probably thanks to the institutional investors who have bet on Bitcoin this year. Maybe the biggest one of them is the hedge fund Grayscale, which owns over 500.000 BTC. After this new Bitcoin ATH, they’re equivalent to $10.4B and almost 3% of the total Bitcoin supply.
MicroStrategy, the company behind the namesake business intelligence software, was another institutional investor this 2020. With over 38.250 BTC, equivalent to $795M, this is now their main reserve asset.
The recent PayPal adoption has contributed as well, and the billionaire British fund manager Ruffer jumped inside the cryptocurrency too, just before the new Bitcoin ATH. According to a recent announcement, they bought around $744M in BTC, equivalent to 2.5% of their portfolio. To do this, the company reduced its exposure to gold, and it was done as a “defensive move”.
Some clues are pointing to other investors doing this same thing: exchanging gold for Bitcoin as a store of value. As indicated by the German Commerzbank, the investors are getting away from gold ETF’s, resulting in a 1% drop of them.
Meanwhile, the multinational investment bank JPMorgan Chase considers that Bitcoin can compete “more intensely” with gold in the near future.
Will it last this Bitcoin ATH?
We saw a similar situation three years ago when Bitcoin and altcoins didn’t stop going up all year, until they didn’t. After reaching its last ATH on holidays, the Bitcoin price began to plummet and lost around 84% of its value by the next December (2018). It could be this new Bitcoin ATH some kind of déjà vu?
We can’t be really sure, but the circumstances are different this time. In 2017, we can say Bitcoin suffered a financial bubble, probably due to the fever caused by Initial Coin Offerings (ICOs) and some large scam investments like BitConnect (BCC). Most of the investors were inexperienced, while now the impulse was given by the institutions.
Additionally, some experts glimpse from here a bullish future. According to a study by Bayerische Landesbank, the BTC price can reach at least $60,000 per unit by mid-2021, and it could even hit $250,000 soon after.
Other firms and enthusiasts, like Prime XBT, Peter Smith, Anthony Pompliano, and Wences Casares, vary their bets from $25,000 to $1M. It seems like it’s just a matter of time from now on.
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