Bitcoin price broke past $10,000 on February 9 for the first time since October last year thus overcoming a major psychological barrier. As expected whenever such positive news happen, the crypto community got super excited and beaming with great optimism. This was accompanied by bold predictions about the future, from crypto experts and newbies alike.
According to many analysts, the current level is just a signal of what’s in store for the future. The popular view is that Bitcoin’s current performance culminating in a $10,000 valuation is just the beginning of a major rally that could propel the digital asset to much higher levels.
Anthony Pompliano, co-founder & partner at Morgan Creek Digital, believes that given the current upward trend, Bitcoin price could hit $100,000 by the end of 2021. According to Pompliano’s tweet, this prediction is based on Bitcoin’s limited supply and growing demand.
Bitcoin just hit $10,000.
I still think that Bitcoin will hit $100,000 by end of December 2021.
Fixed supply. Increasing demand. Time will tell. #Bitcoin
— Pomp 🌪 (@APompliano) February 9, 2020
Whereas one may be quick to dismiss Pompliano’s prediction as being overly optimistic it is wise to review some fundamentals that support this assertion. Bitcoin has a deflationary monetary policy in that its supply is certain, predictable and fixed. It has a fixed supply of 21 million with 18 million already having been generated. Future supply is also expected to decline due to halving which slashes the total Bitcoin created for every block mined.
The next halving will occur in May this year which will result in a huge decline in supply. At the same time, demand for Bitcoin continues to grow as more people begin to adopt the digital currency. There is also an increasing demand from institutional and mainstream market investors seeking to acquire the asset evidenced by the growing demand of Bitcoin futures and options market. It is this mismatch and growing disparity between Bitcoin’s demand and supply that Pompliano predicts will catalyse a massive price rise to reach $100,000 level in 2021.
Other crypto analysts and industry insiders have expressed sentiments similar to Pompliano with crypto analyst Willy Woo revealing that Bitcoin’s price activity is backed by fundamental investment activity.
This breakout is the real deal. Fundamental investment activity is backing this $10k breakout. pic.twitter.com/IDWmhXX2Mj
— Willy Woo (@woonomic) February 9, 2020
Arthur Hayes, Co-Founder & CEO of BitMEX, was also in a bullish mood after Bitcoin hit $10,000 with his tweet suggesting that the cryptocurrency still has room for further growth.
— Arthur Hayes (@CryptoHayes) February 9, 2020
Most of the public discussion on Twitter was centred on these bold predictions and speculation as to how high Bitcoin can go if it keeps its upward price momentum. Mostly positive views continue to be expressed as people keep on monitoring the movements in the markets.
Image courtesy of Pixabay
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