Where does bitcoin go from here?

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Bitcoin has risen by over 50% since early October, building on price increases of over 500% since last October and 5,000% over the past four years.

After hitting an all-time high above $ 66,000 this week, analysts in the crypto market are wondering if such remarkable momentum can be sustained.

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A popular price prediction model puts bitcoin on track to hit six digits before the end of 2021, although its notorious volatility threatens a major correction at some point.

But the prospect of a potential price crash, like the one seen after the historic high in mid-April, is refuted by those who believe that bitcoin’s intrinsic value lies in its inherent scarcity which limits its supply to $ 21 million. units.

Adherents to this theory refer to bitcoin as “digital gold,” believing that it could eventually exceed the $ 11 trillion market capitalization of gold – making each coin worth more than $ 500,000.

The launch of the very first bitcoin futures exchange-traded fund (ETF) on the New York Stock Exchange this week also boosted comparisons between the cryptocurrency and the precious metal. The move was a major milestone for the crypto industry, helping to propel bitcoin to record levels by opening it up to a legion of previously untapped institutional investors.

A similar price spike was seen following the NYSE’s listing of the first gold ETF in 2004, when its market cap was roughly equal to that of bitcoin today.

“$ 100,000 is a very realistic target for bitcoin in the relatively short term, but it has the potential to go much, much higher,” Nick Spanos, co-founder of the Platform Protocol co-founder of The Independent, told The Independent. decentralized Zap application.

“So even investors who buy now could potentially see their investment increase 10 times. I understand the attraction of altcoins [like the uncapped Ethereum]because they offer potentially higher returns and can appear to be significantly undervalued, but I think bitcoin should be a big part of any crypto portfolio as it is the future of money and has huge untapped potential. .

This idea of ​​bitcoin as the ‘future of money’ has been trampled on in recent years, with critics claiming it lacks the scalability to function as a traditional form of payment. Until recently, transactions on the bitcoin network were both expensive and time consuming, but the introduction of the large-scale Lightning network could theoretically solve these problems.

One of the places where this second-layer technology is put to the test is El Salvador, where bitcoin became legal alongside the US dollar in September. This is the first time in the world that a country has adopted a cryptocurrency as an official payment method, and the success of its deployment could inspire other countries to follow.

Politicians in several other Latin American countries are already taking steps to introduce bitcoin-friendly legislation, including in Argentina, Panama and Paraguay. Advocates say it offers a way to bypass costly transfer fees, reduce reliance on the U.S. dollar as a reserve currency, and increase financial inclusion for those left behind by the formal economy.

El Salvador’s bitcoin announcement earlier this year was one of the triggers for the cryptocurrency’s massive price hike, and further gains can be expected if more countries follow suit. With a market capitalization of over $ 1.2 trillion, bitcoin is already the 13th largest currency in the world, having surpassed the Swiss franc in its latest surge.

The global cryptocurrency market also hit an all-time high this week, reaching over $ 2.5 trillion for the first time in its history.

This ranks it above Apple, the most valuable company on the planet, while bitcoin alone is now worth more than Facebook and Tesla.

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John Karony, CEO of SafeMoon crypto token, believes that the attention these latest records have brought to bitcoin will see institutional investments bolstered by renewed interest from retail investors, which could prove to be the catalyst for a parabolic rise in prices.

“Bitcoin’s latest all-time record will set a new precedent for the cryptocurrency industry, as the headline-grabbing price has the ability to finally make crypto a standard,” he said. he told The Independent.

“Anyone can now access cryptocurrency with just a few clicks from their phone. It is no longer something that is only talked about online – now anyone can acquire it easily, the same way people do their weekly shopping online.

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