Despite recent volatility, bitcoin and cryptocurrencies have skyrocketed in the last year, with the bitcoin price increasing by around 250 percent.
The bitcoin price reached $60,000 earlier this year before plummeting, losing roughly 40% of its value in a matter of weeks. Many crypto investors, however, believe bitcoin will surge far beyond its recent highs, potentially boosting other smaller cryptocurrencies.
Now, one early bitcoin investor who manages a $2.8 billion crypto-focused fund predicts that massive mainstream adoption will drive the bitcoin price up by around 1,500% over the next decade.
Pantera Capital founder Dan Morehead said, “We did a study showing the number of people using bitcoin over the years and the price of bitcoin.”
“Every two years, both of those data series increased by an order of magnitude. If this trend continues, bitcoin will be worth $700,000 when everyone with a smartphone uses it. A ten-year forecast is reasonable.”
Bitcoin and cryptocurrency adoption has skyrocketed in the last year, thanks to payment platforms like PayPal and financial technology companies like Jack Dorsey’s Sqaure that allow users to buy and trade digital assets. Others, such as card giants Visa and Mastercard, have recently indicated that they are planning to increase their support for bitcoin and cryptocurrencies.
Bitcoin received a significant boost in awareness this year as a result of Tesla billionaire Elon Musk’s support. Tesla announced in February that it had purchased $1.5 billion in bitcoin, putting bitcoin on the corporate radar.
Others have cited bitcoin as a hedge against a rising tide of inflation that threatens to devalue fiat currencies as a result of massive coronavirus-induced money printing.
“I think the macro story is so positive, there is so much money being printed, and so many institutions are coming into the space that the markets are going to resume their rally over the next twelve months,” Morehead predicted.
Meanwhile, bitcoin and cryptocurrency traders are keeping a close eye out for indicators of where the bitcoin price may be heading in the near future.
“Some on chain metrics suggest a continuation of the recent uptrend,” Marcus Sotiriou, sales trader at the U.K.-based digital asset broker GlobalBlock, wrote in a note this week, citing data indicating that short term speculators have been selling while long term holders have been accumulating over the past few months.
“Technically, bitcoin closed above the 21-week exponential moving average [yesterday], which many consider being key bull market support, as well as the 100-day simple moving average. The breakdown of the rising wedge, on the other hand, suggests that bitcoin may fall back to the mid-range at around $36,000, or lower before the rally resumes.”
Following the May price crash, bitcoin has struggled to find support above $40,000 per bitcoin. However, some believe that will change in August.
“The data from the options suggests that the market is positioning itself for another leg up on bitcoin by mid-August,” wrote Pankaj Balani, CEO of crypto derivatives exchange Delta, in a note.