Bitcoin has been making headlines for an extended time. Contrary to events from 2017 when prices dipped heavily after reaching a milestone, this time BTC prices seem to have matured. For now, many analysts throw Bitcoin Price Predictions for a new milestone of 100K by the end of 2021. Will this truly happen? Is Bitcoin a good investment in 2021?
Is Bitcoin a Good Investment in 2021?
A lot has happened in the past year. Bitcoin and other Altcoins were sinking and had a very bad momentum, where prices went back to 2016 levels. Let’s quickly recap the events that happened in the past year.
1- Cryptocurrency Bear Market
It is well known that cryptocurrency prices were going down after Bitcoin almost reached 20K in 2018. Momentum was lost and everyone started dumping their coins, fearing that usage of cryptos will never pick up. The mainstream media played a huge role in spreading FUD. This happened when polished rookies appeared on well-known Finance talk shows, and started bashing cryptos, calling them Bubbles, Fads, and Useless Tech. Boy how wrong were they.
2- Covid-19 Market Crash
After starting to recover from the 2018 market crash, another market disturbance happened, but this time it affected markets across the world, including equity markets, bond markets, and commodity markets. This COVID-19 crash was the result of people anticipating extended problems in the economy such as unemployment, market retractions, business closures, and many other societal problems. Usually, investors tend to liquidate their portfolios to minimize risk, and cryptocurrency investors did the same, sending crypto prices to their 3-year lows.
3- Crypto COMEBACK
As stated earlier, investors started dumping their portfolio holdings. But as soon as they noticed that Cryptocurrencies don’t relate to actual markets (that arguments that says that nothing backs cryptos), investors noticed that they can take their investments from the actual world and store them in the digital world. Ever since, prices shot THROUGH THE ROOF, and in figure 3, we can clearly see the difference between the COVID-19 crash and actual prices.
Bitcoin Price Prediction – Will Bitcoin reach 100K?
According to many news outlets, Bitcoin is predicted to reach 100K before the end of 2021. From a current price of around USD 57,400, this represents an increase of 74.2%. Even the best Wallstreet Traders couldn’t get a performance anywhere near that figure. That’s why most people buy Bitcoins and hold them, for the well-known and common reasons:
- Bitcoins are limited (21 million supply)
- Digital usage is on the rise
- The need for decentralization is increasing
- Blockchain usage is expanding across many industries
- Famous investors and influencers are backing cryptos and pushing them to the mainstream
On top of the above points, we can CLEARLY notice the price maturity that has been happening. Unlike the 2017-2018 periods, prices are taking breathers, consolidating, and there’s significantly less hype. In figure 4, we can see a clear uptrend channel that should take Bitcoin prices to the mid-60K levels soon. So if you hold Bitcoins, just relax and enjoy the ride;)
Stay Ahead, Stay updated
Rudy Fares
