Bitcoin is up for four weeks in a row and is on track for its second monthly advance
Bitcoin up to $100,000. Bitcoin to the moon. Bitcoin to infinity. The world’s largest cryptocurrency is making a comeback, gaining more than 50 percent from recent lows, reviving animal spirits and hitting sky-high price targets that, while a source of comedy for some, crop up when the asset rises.
There are predictions that the digital currency was poised to retest $20,000 amid a slew of negative headlines that many said would push it lower. Back in vogue are the calls for the coin to rise again to its all-time high and beyond.
And there are plenty of superlatives to mark the moment: Bitcoin has risen four weeks in a row and is on pace for its second monthly advance. Overall, it has seen its fastest 21-day advance since February, the last time it was midway toward records. It traded at $45,781 in New York at 5:42 PM.
“It’s buzzing back,” Meltem Demirors, chief strategy officer at crypto fund provider CoinShares, said by phone. Despite new regulatory oversight, “many investors see this as positive news and a positive catalyst because it clears up a lot of the confusion or some of the uncertainty. And I think what’s also being shown is that the crypto- community is no longer an esoteric corner of finance.”
Defying criticism over its environmental toll, the cryptocurrency is moving forward even as regulators around the world promise tougher crackdowns. For example, China has taken a number of steps to curb crypto mining, among other things. In the US, policymakers are targeting digital assets in a new way, with US Securities and Exchange Commission chairman Gary Gensler calling the space the “Wild West” last week. He said he would not compromise on investor protection by establishing a regulatory framework.
Strategists are pushing aside those concerns for now and instead bring forward rising price targets, which have long been part of the investment thesis behind getting into cryptocurrencies.
“There’s still plenty of room to get to the old high,” Bloomberg Intelligence’s Mike McGlone said in a televised interview. “And guess what? If it just follows Ethereum, it goes to $100,000,” he said, referring to Bitcoin overtaking the second token in percentage terms.
Tom Lee of Fundstrat Global Advisors also sees it reaching $100,000 by the end of 2021. The company’s co-founder and head of research recommends investors follow a simple rule: If Bitcoin moves above its average price in the past 200 days, it becomes a long-term momentum measurement — then it’s time to buy. The coin has crossed that hurdle in recent days. “With Bitcoin moving above 200D, we believe Bitcoin will rise sharply,” Lee wrote in a note at the end of the year.
The rally comes even despite potential tax filing requirements. A change to cryptocurrency reporting rules in Congressional infrastructure law was blocked in the Senate on Monday, leaving language in the legislation to be passed by the Senate for broad oversight of virtual currencies.
Kristin Smith of the Blockchain Association said she was surprised that the coin came out during the infrastructure bill debate – she thought the opposite might have happened.
“I don’t understand the prices. I thought the prices would go down because of the bad language that some there suggested,” she told Bloomberg’s streaming show “QuickTake Stock” Monday, ahead of the blocking of the facility. “People are seeing the effectiveness that the crypto community and the crypto industry in Washington are having. And I think there is confidence that we will eventually be able to get the policy right.”
To be sure, it has been a “mistake” to tie fundamental developments to any of Bitcoin’s moves, said David Donabedian, chief investment officer of CIBC Private Wealth Management.
“What’s driving it is momentum and money flows, and a bit of general risk-on, risk-out sentiment in the markets,” he said. “Anything you say or write about Bitcoin, you can always do a big percentage — it’s up 50 percent, yes, but it’s down 50 percent from April to June,” he said, adding “there’s no credible way to appreciate it.”
It is inevitable. #Bitcoinpic.twitter.com/Rs4yOgA1Hs
— Samuel |⛏️₿⚡|∞/21M (@samusalo) August 9, 2021
But fans watching the showdown in Congress saw it as confirmation from the industry. On Twitter, some concluded that the community was strong enough to rein in senators, while others sparkled their rally, reiterating that it will go on indefinitely.
Other negative news has likewise been brushed aside for now. China had recently reiterated its call to restrict Bitcoin mining and trading, but Viridi Funds’ Ethan Vera said this turned out to be a positive development for Bitcoin.
“They banned it, but the network remained fairly stable,” said the company’s co-founder and chief financial officer. “That kind of shows the resilience of the overall network and how it’s bigger than a single country.”
(Except for the headline, this story has not been edited by NewsMadura staff and has been published from a syndicated feed.)
