Bitcoin flirts with elusive USD 50k as bulls dig in heels
(Kitco News) - The bitcoin price briefly recrossed the psychologically important $50,000 level, and investors are already setting their targets higher.
According to some analysts, once bitcoin is on the other side of USD 50K, the market leaders have set the USD 100K threshold in their sights. Anthony "Pomp" Pompliano of Pomp Investments believes the chances are good that the bitcoin price will double to cross the USD 100K by year-end, based on historic precedent.
Dan Held, director of growth marketing at cryptocurrency exchange Kraken, can be counted among the bitcoin bulls. Held made a bold prediction Thursday, forecasting that "bitcoin will overtake the market cap of gold."
Considering that bitcoin's market cap currently hovers at USD 1 trillion, which isn't too shabby, and gold's market cap is around USD 10.7 trillion, the flagship cryptocurrency has a way to go. Held points out that "when this happens," the price for one bitcoin will be USD 475K and urges investors to "plan accordingly."
Bitcoin will overtake the market cap of gold.— Dan Held (@danheld) September 2, 2021
When this happens, 1 Bitcoin will be worth $475K.
Not everyone agrees. Bitcoin critic Peter Schiff, who is at the helm of Euro Pacific Capital, attempted to turn the tables on the bullish bitcoin price and place the focus elsewhere. Schiff pointed out that bitcoin's dominance of the broader cryptocurrency market has been shrinking, which it has.
At the start of the year, bitcoin's dominance based on market cap was nearly 70%, while it currently hovers at roughly 42%. Schiff points to the thousands of cryptocurrencies that comprise the market. This number has expanded with the rise of niches such as decentralized finance or DeFi.
As far as Schiff is concerned, "none of these digital tokens are really scarce," even though bitcoin has a finite supply of 21 million coins. According to him, "supply will eventually overwhelm demand."
Based on the trajectory of the bitcoin price coupled with increased signs of institutional adoption, the bulls seem to have it at the moment.
Despite a murky regulatory environment for cryptocurrency and blockchain providers, green shoots of legal clarity are also starting to emerge. Texas has implemented what's known as a bitcoin bill that sends a message that the Lonestar State is crypto-friendly. Technically known as HB 4474, the bitcoin bill defines virtual currencies and paves the way for greater institutional participation in the market.
Of course, institutions have already started to come off the sidelines on crypto and more are expected to tip their hands to holding bitcoin sooner than later. Once they do, the fear-of-missing-out (FOMO) phenomenon could kick in, which might be the catalyst that the bulls need for their predictions to come true.