The Bitcoin price is likely to hit an all-time high of $60,000 this week as the U.S. House of Representatives is expected to pass Democrats’ $1.9 trillion stimulus bill this week, predicts the CEO of one of the world’s largest independent financial advisory and fintech organisations.
The forecast from Nigel Green, the chief executive and founder of deVere Group, comes as the cryptocurrency hit a market capitalisation of $1 trillion Tuesday, as prices reached $54,900 on the deVere Crypto exchange app – which comes just short of February’s $58,000 all-time high.
Mr Green says: “The price of Bitcoin, the world’s most dominant cryptocurrency by market cap, is climbing again this week following its impressive bull run earlier this year.
“It’s already closing in on its record high hit in February and I believe that we can expect it to surpass this – likely reaching $60,000 – this week.
“The recent surge is largely due to the U.S. Democratic leaders aiming to get the legislation on the $1.9 trillion stimulus package through the House as soon as Tuesday, if not Wednesday.”
The stimulus package will be a considerable driver for the price of Bitcoin for three reasons, according to the deVere CEO.
“There’s a risk of a debasement of the dollar, the world’s reserve currency, from such an enormous stimulus package. Bitcoin, of course, cannot simply be printed. Indeed, it is living up to its reputation as ‘digital gold.’ Like the safe-haven precious metal, it’s widely accepted as being a store of value, a medium of exchange, and is valued for its scarcity.
“There’s also some concern that the relief plan will trigger longer-term inflation.
“In addition, others have suggested stimulus checks could be used by recipients to invest in cryptocurrencies for the first time or expand their existing crypto portfolios.”
Other contributory factors toward Bitcoin’s new rally include growing interest from institutional investors.
This week, PayPal, the payments giant, confirmed that it is to acquire Curv, the cryptocurrency security firm.
It follows their decision last year to allow customers to buy, sell and hold Bitcoin and as Wall Street giants explore Bitcoin and crypto asset custody.
Mr Green concludes: “This week is set to be one to remember for all the right reasons for Bitcoin holders.”
Bitcoin Price Shoots Past $60K, Ether Hits New All-Time High in Early Saturday Trading
Bitcoin’s price neared its all-time high of $61,712 early Saturday while ether (ETH, -0.26%) set a new all-time high at $2,190.
According to CoinDesk’s Bitcoin price page, the leading cryptocurrency traded above $60,000 for the first time in nearly a month after spending weeks vacillating between $52,000 and the upper $50,000s. Bitcoin pulled back marginally after peaking around $60,900, though it remains above the psychological marker as of press time.
Bitcoin last hit an all-time high in mid-March, according to CoinGecko.
Meanwhile ether, the second-largest cryptocurrency by market cap, came close to $2,200, just days after breaching $2,100 for the first time.
While it’s unclear if there’s a causation, the price action comes just days before leading U.S. exchange Coinbase begins trading on Nasdaq in one of the crypto industry’s most anticipated events. A sign of the maturing market, the listing will likely give Wall Street traders their most accessible bet yet on growth in the space.
Some institutional investors have wasted little time. Friday, Daniel Loeb, CEO of $17 billion hedge fund Third Point revealed he was a hodler in response to a CoinDesk report. He’s hardly alone: institutional funds have flooded the markets and have been deemed at least partly responsible for the 2020-2021 rally.
Bitcoin bulls were further bolstered on Friday by the idea that an exchange-traded fund (ETF) with exposure to the digital asset space might be approved in 2021, after the Securities and Exchange Commission (SEC) confirmed it was reviewing ETF giant WisdomTree’s application.
The regulator previously began reviewing VanEck’s ETF application last month, and another six companies have filed initial registration forms declaring their own efforts to launch a regulated bitcoin (BTC, -0.99%) investment vehicle.
The broader digital asset space has seen tremendous froth over the past few months, with investors and industry participants trading heavily in decentralized finance tools, non-fungible tokens and altcoins like doge, which hit a peak of $0.08 in February, eight times its value a month earlier.
Bitcoin Futures Open Interest Surges by 130% in 2021, While Gold’s Drop 17%
Data calculated by Finbold indicates that bitcoin futures open interest on various exchanges has grown by 133.74% between January and March 30, 2021, from $9.66 billion to $22.58 billion. In February, the value was at $10.88 billion.
The spike in bitcoin futures open interest reflects the surge in the asset’s price, initiated mainly by the entry of institutional investors into the sector.
Institutions might be considering adding more bitcoin to portfolio
The report explains what the rising bitcoin open future means in relation to institutional investors. According to the research report:
“The growth in open interest might also indicate institutions from traditional finance are considering adding more bitcoin exposure to their portfolios. As institutional investors continue hedging using futures, the demand for leverage increases.”
Elsewhere, gold futures open interest has plunged between January and March 2021 by 17.54%, from $116.30 billion to $95.90 billion. In February, the value of gold open interest futures was $107.7 billion. During this period, the price of gold has also plunged by at least 9%.
The analysis explains why gold open interest futures have plunged. According to the research report:
“The open gold futures have plunged in the first three months of 2021, correlating with the precious metal’s price fluctuations. The decreasing open interest in gold suggests that the buying power is drying up, and thus at least a corrective downswing is to be expected.”
The growth in bitcoin open futures offers validation for cryptocurrency supporters to believe the asset will eventually replace gold as the store of value. However, despite bitcoin surging, it is still miles away from surpassing gold in terms of the value of the open interest futures.
Tesla Now Accept Bitcoin, Says Elon Musk
Elon Musk, the Chief Executive Officer of Tesla Inc., on Wednesday announced that customers in the United States can now purchase Tesla vehicles with Bitcoin.
The billionaire industrial designer disclosed in a series of tweets via his official handle @elonmusk.
You can now buy a Tesla with Bitcoin
— Elon Musk (@elonmusk) March 24, 2021
He, however, explained that the electric vehicle manufacturing company is using only internally developed and open-source software for the transactions, saying it operates Bitcoin nodes directly.
Musk added that Bitcoin paid to the company will be kept as Bitcoin and not converted to fiat currency.
“Tesla is using only internal & open source software & operates Bitcoin nodes directly. Bitcoin paid to Tesla will be retained as Bitcoin, not converted to fiat currency.
“Pay by Bitcoin capability available outside US later this year.”
The new initiative by the world’s leading electric vehicle manufacturing company will help push Bitcoin and other cryptocurrencies to the mainstream, especially given Elon Musk and Tesla brand reach in the United States, the world’s largest economy.
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