In early December 2020, the price of Bitcoin still hadn’t surpassed an all-time high the crypto asset set in 2017, and some in the space were speculating if or when it could. However, almost three years to the day since BTC first rose to a price of $19,891, the coin surged past $20,000, $30,000, and $40,000 in less than a month.
Though there were significant dips in late January and February 2020, the price of Bitcoin has largely been on a bullish track due in part to major institutions investing in BTC as a reserve asset and more lawmakers seemingly attempting to recognize where it will fit in the global economy. At the time of writing, the BTC price’s all-time high is more than $61,000.
Overview for Fast-Readers
The previous all-time high of Bitcoin prior to 2020 was $19,891, set in December 2017
Major institutional adoption for Bitcoin has likely been the biggest fuel for its latest bull run
Some are predicting the price of Bitcoin could reach $100,000 if not higher in the next year
Will Bitcoin reach $100,000 in 2021?
The price of Bitcoin rose more than 200% from December 2020 when it matched the high set during the 2017 bull run to more than $61,000 in mid-March. There are a few reasons many see the BTC price continuing to surge in 2021.
Last year, U.S.-based business intelligence firm MicroStrategy made headlines after announcing it had purchased $250 million in Bitcoin as a reserve asset. The firm has made public statements indicating it will continue to invest in crypto through 2021 and beyond.
However, MicroStrategy was neither the first, nor will it likely be the last business to adopt Bitcoin. Electric car manufacturer Tesla’s $1.5 billion Bitcoin purchase in February 2021 likely pushed the price of the crypto asset to more than $50,000 for the first time. In addition, Square has invested more than $220 million in Bitcoin to date.
Though major institutional adoption is likely a bullish factor for Bitcoin, there are other reasons many in the crypto space see 2021 as the year BTC will rise past $100,000. Many see the tapping of MIT professor and former Commodity Futures Trading Commission chair Gary Gensler to lead the U.S. Securities and Exchange Commission under President Joe Biden as a bullish sign for digital currency adoption. However, the president of the European Central Bank has said regulators need to tighten the rules to prevent Bitcoin from being used for money laundering and other illegal activities.
How high could it go?
A number of figures in the crypto space have made predictions based on previous BTC price trends. PlanB, the creator of the stock-to-flow Bitcoin price model, claims that the price of the crypto asset will sit anywhere from $100,000 to $288,000 by December 2021.
Other predictions include those from crypto expert Bobby Lee, who claimed in 2018 that the price of Bitcoin would reach $333,000 by 2022. However, he recently modified his prediction to still have BTC in the six-figure range, saying the price of the crypto asset would be between $200,000-$250,000 in 2021.
Is a crash possible?
A crash is always possible, especially in volatile assets like cryptocurrencies. At the beginning of the COVID-19 pandemic, the price of Bitcoin dropped from the $9,000s to the $3,000s within a week and didn’t recover for almost two months.
However, some analysts have been split on whether Bitcoin is even capable of going to zero. The price of the crypto asset is not completely uncorrelated from traditional assets, meaning it has surged or faltered in response to fear, uncertainty, and doubt from social media as well as political reasons.
Bitcoin could rally as high as $100,000, says J.P. Morgan
In January, Bloomberg reported that strategists from JPMorgan Chase led by Nikolaos Panigirtzoglou predicted that Bitcoin could rise to a “theoretical price of $146,000” in the long term, but was unlikely to do so in 2021. Rather, this prediction was based on the total private sector investment in Bitcoin matching the value invested in gold via either exchange-traded funds or bars and coins.
“While we cannot exclude the possibility that the current speculative mania will propagate further pushing the Bitcoin price up toward the consensus region of between $50,000-$100,000, we believe that such price levels would prove unsustainable,” said the strategists.
Analysts and experts can toss bullish and bearish predictions out for the price of Bitcoin until the cows come home — no one can see the future. However, having such prominent figures push such sentiments among investors can sometimes become a self-fulfilling prophecy, i.e. if someone confidently predicts the price of Bitcoin will rise and people buy more BTC as a result of that prediction, then the price could increase.
In the case of Bitcoin, analysts from major institutions like JPMorgan predicting a price surge is significant in that the companies saying it might have previously advocated against investing in crypto. These voices could propagate around the financial ecosystem as others look to BTC as a hedge against inflation and invest, potentially driving the price upwards.
Turner Wright did not buy Bitcoin before 2013, and has been making up his potential losses with freelance writing work for various crypto publications. He gets his inspiration from a combination of green tea, dark chocolate, and pressure.
Cookies are small data files composed of a string of characters that may be stored on the device you use to access Thebitcamp.com. Cookies may create a record of your preferences or other information but do not read data from the memory portion of your device or access other cookie files from other sites you visit. Additional information about each type of cookie can be found in the sections below.
You do not have to accept cookies and consent can be withdrawn at any time. Not accepting or deleting our cookies, may negatively impact the use of our website.
Strictly necessary cookies are necessary for NoGo Media Ltd. and Thebitcamp.com to protect the website from hacking or other threats. You may refuse, block or delete them, but your experience using the website will be negatively impacted and not all services will be available to you.
Performance cookies help us to understand our users needs and how we can improve our services and website performance. This information is anonymous and aggregated. If you block these cookies, the website will still function, but it will be more difficult for us to make these improvements.