Bitcoin is attracting more funds than the combined worth of golds, bonds, and stocks, as per Bloomberg’s latest crypto-related report. The paper just forecasted that $100,000 is the next possible price threshold for BTC to achieve. As per the report, BTC has started the process of replacing Gold into being the hedge of choice.
Bitcoin Displaces Gold?
The prediction that Bitcoin, which many people refer to as digital gold, will or is already replacing the shining metal, a fact that the cryptocurrency community is discussing again and again. On top of that, the COVID-19 started a financial crisis, and the financial industry’s rebalancing confirmed this fact further.
Bloomberg experts confirmed their stand in their Crypto Outlook paper released in March. The report says that “the process of bitcoin replacing gold in portfolios is accelerating, and we see risks tilted toward more of the same.”
The document mentioned 2020 as being the breakout year for Bitcoin, especially for corporations and institutional investors. According to them, this year saw that Cryptocurrency “gained legitimacy with declining volatility versus the opposite in most assets.”
This situation intensified further in 2021 as old guard gold dealers started focusing on “sensible diversification.”
Earlier too, analysts from US multination firm JP Morgan had mentioned that bullion’s price could dip in upcoming years. BTC will continue to bite substantial chunks of its market share, thus dampening its prospects.
$100,000 is Next for Bitcoin?
The paper also explains that the current state of the primary cryptocurrency shows that it has moved out of the area of risk assets into a “global digit store of value.” In the coming years, this role will become stronger as the digital footprint would expand further.
After keeping the demand from institutions in mind, the Bloomberg report suggests that the next price target could be into the magnificent $100,000 figure.
Apart from that, the document also talked about Grayscale and Grayscale Bitcoin trust or GBTC. In late February, the GBTC premium dipped in the negative zone in comparison to its NAV.
The analysts also believe that $100,00 at the end of the year is achievable. The Co-Founder of Magnetic, William Quigley, even quotes $150,000 in the next 12 months.
Diminishing Bitcoin Supply, Reluctant Sellers Worried About Bitcoin Sellers?
On-chain indicators and price progression of BTC were halved in 2020 due to a reduction in selling enthusiasm. The annual mining of new coins reduced to 2% of the supply this year as long-term holders are reluctant to sell, just like in 2016. Indications that these holders would be unwilling to sell even above the $40000 could maintain the price hike.
Ever since 2010, the measure of one-year active supply from Coin metrics has never reached a level lower as it did in 2020. The percentage of total bitcoin supply on-chain resembles the same bottom that it earned in 2016. This envisages the growth possibilities of Bitcoin, and naturally, all that comes in its wake will suffer a loss. This implies that the target of $100,000 is achievable, but it will come at the cost of Gold.
