Will Bitcoin Value Go Up To US$20,000 By 2020?
14 December 2018 | Fri
We are unable to predict the future value of digital currency, however, there are good indicators in determining the outcome of it’s future value which are as such; the technology advancement, the different applications of the currency, partnerships with the market-based economy and regulations put in place by the central authority. A common understanding to all kinds of investment pursuits is that one should do research before committing and one should never commit because of a price prediction that is seemingly optimistic.
Will one unit of Bitcoin ever cross US$20,000 in 2020? Many have pondered about this and hence stuck in a conundrum on whether they should invest in this relatively new type of currency. A recent comment by two analysts from established banks, during their course of Bitcoin analysis, predicts that one unit of Bitcoin will be able to cross US$90,000 in the next five years. They based this forecast on the fact that majority of the crypto-assets market capitalisation is held in the traditional store of value markets, and with offshore deposits amounting to nearly 40% of the total value. Hence, growth in this market capitalization will come primarily from the increased store of value penetration. Moreover, when more custody solutions come on board, this penetration of offshore deposits will increase dramatically. They postulated that the broader digital currency market will enjoy robust growth, reaching a grand total of US$3.6 trillion in 2028, approximately 1,700% higher than the digital currency market’s current value of US$200 billion.
Some critics claim that the forecast prices are too ambitious, while others believe that there are difficulties in accurately predicting the value of digital currency will eventually be, five years from now. Bitcoin’s worth could rise from US$10,000 to US$100,000 in the next two to three years, as many different variables might come in play to influence the status quo of the market between now and 2020. Digital currencies and assets could be thought of as the future of transactions and a store of value, and Bitcoin is now leading the revolution.
An ‘Ambitious’ Price Forecast
A crucial rallying factor for Bitcoin is in its ability to retain its store of value. Take for instance, places facing hyperinflation like Iran, Turkey, and Venezuela. The use of digital currencies will ensure the purchasing power of the people is to be retained. However, to based an assumption on the fact that such currency will capture a sizeable market share in major economies such as the US, Singapore, Germany and UK over the next five years, is highly plausible.
Bullish Predictions ‘Entirely Possible’
Market observers have taken notice that Bitcoin could very well hit over $90,000 by 2023. They claimed that a US$100,000 per coin evaluation for Bitcoin is entirely possible, while Bitcoin has a US$112 billion dollar market cap that represents a negligible 0.1% of the entire global money supply of US$90.4 trillion dollars. Hence Bitcoin being a leading digital currency and to be able to cross over US$90,000, given past bull markets, seems achievable. In 2017, Bitcoin’s value has increased from below US$1,000 per unit to more than US$16,000 per unit, which is a remarkable sixteen times increment in that year. Today, Bitcoin is trading around $6,450, they reasoned that if Bitcoin were to withstand this volatile level and to continue this up-trending increase, crossing over US$90,000 per unit will be something that will be achievable during the next Bitcoin bull run.
Digital Assets ‘Here To Stay’
Although Bitcoin has been trading for almost ten years, the regulations placed on the digital currency market is still at its infant stage. Fiat-based investment community claims that when Bitcoin is subjected to regulation, the price of Bitcoin will be unfavourable as there will be many policies to control the inflow and outflow of the coins, hence making it harder for the digital currency to be transfered. However, this was not the case in Japan. In 2017, Japan was the first country in the world to completely regulate Bitcoin the same way as its financial services industry. The government established that Bitcoin and the Japanese yen are to be on par, hence Japan now has the highest trading volume for Bitcoin in the world, with many Japanese using it daily in over 200,000 stores.
If other nations were to adopt the ways of the Japanese government, it will boost Bitcoin’s legitimacy. This will beget trust from the global community use digital currency , moreover, this new beginning will call for larger financial institutions to buy and transact in Bitcoin and in turn giving rise to the price of Bitcoin.
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