What's next for Bitcoin after smashing record?
Bitcoin has lost some momentum after rallying to an all-time peak, but proponents believe it may still cross US$80,000 this year.
- Bitcoin (BTC) price hovers around US$63,000 this week
- The cryptocurrency recently broke another record, topping US$67,000
- New BTC ETFs are driving the coin’s price higher
- But JPMorgan believes the space is getting crowded
- Keen to take advantage of Bitcoin’s rising price? Open an account with us to long the digital asset now.
BTC price: What’s the latest?
As of 16:33 SGT on Tuesday (26 October), the world’s largest virtual coin advanced 0.3% to US$62,961. Bitcoin has been trading near or slightly past the US$63,000 level on both Monday and Tuesday in Asia.
It had experienced volatile trading sessions in the previous week, striking a fresh all-time high of US$67,016 last Wednesday (20 October 2021). That was its highest point in six months, following its previous top of US$64,895.
The peak came after BTC exchange-traded funds (ETFs) began trading in the US. The ETFs, which are based on Bitcoin futures, could boost mainstream retail and institutional interest in the cryptocurrency and contribute to its price movements, Reuters reported.
The digital token’s rally was so strong last week that it entered ‘overbought’ territory; its 14-day relative strength index (RSI) reached 71 on Thursday. Assets are considered overbought if the RSI exceeds 70, and oversold if it dips below 30, Bloomberg noted.
Why does JPMorgan see limited impact?
Kicking off the ETF-fuelled rally last week was the debut of the ProShares Bitcoin Strategy ETF, which trades under the BITO ticker.
However, JPMorgan’s research team was sceptical about the longevity of the new product’s boost to the BTC price.
The analysts said in a note: ‘Will the launch of BITO by itself bring significantly more fresh capital into Bitcoin? We doubt it, given the multitude of investment choices Bitcoin investors already have.’
They highlighted that the bulls believe the ETF will ‘open the avenue for fresh capital to enter Bitcoin markets’, whereas the bears are seeing it as ‘only incremental addition to an already crowded space of Bitcoin investment vehicles’.
Will BTC cross US$80,000 this year?
A poll of 50 fintech specialists, by Finder.com, found that the world’s leading cryptocurrency’s price is predicted to crack the US$80,000 mark this year.
They expect the coin to peak at US$80,021, and about 23% believe it will even surpass US$100,000.
That being said, the industry experts foresee BTC to subsequently dip to US$71,415 apiece by the end of 2021.
The report released last week showed that 46% of the panellists said now is the time to ‘buy’ BTC, 46% recommended ‘hold’, and only 8% suggested to ‘sell’.
Iwa Salami, associate professor at the University of East London, expects Bitcoin ETFs to help current crypto investors diversify their portfolios and encourage more retail investors to invest in the digital asset.
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