The world’s leading cryptocurrency Bitcoin is under the “increasingly favorable technical and fundamental underpinnings” that could result in the major bull run, predicts Bloomberg Intelligence.
The latest crypto report from Bloomberg reveals that the Bitcoin may approach the record high of about $20,000 this year. Furthermore, both BTC and gold will be the only assets to outperform all other kinds of commodities, analytics predict.
The main reasons behind the optimistic forecast include the maturity of Bitcoin, the growing usage of stablecoins, and the technical patterns similar to the historical ones, that indicated the huge bullish run.
The impact of pandemic
According to the report, the leading crypto is showing the serious signs of maturity, which brings it to become a digital version of gold. Since the leading crypto regained its value after the mid-March market crash, Bitcoin passed the coronavirus test better than stock markets and crude oil. Analytics claim, that the fact indicates a firming price foundation of BTC.
Furthermore, the growing number of Bitcoin futures contracts contributes a lot to the further maturing of the world’s benchmark cryptocurrency. As analysts reported previously, the futures allow trading Bitcoin at a predetermined price at a specified time in the future, which helps to hedge positions and reduce the risk.
The near doubling in futures open interest toward the level when Bitcoin topped $10.000 in 2019 indicates the rapid pace of maturation and a tilt toward higher prices. [...] Futures are significant as a primary gateway for the benchmark crypto to become a mainstream asset class.
Despite the growing numbers of futures, the general institutional interest in the world’s dominant crypto asset is increasing as well. The large crypto management companies like The Grayscale Bitcoin Trust (GBTC) are taking an increasing amount of newly minted Bitcoin supply off the market.
The impact of stablecoins
Since the coronavirus pandemic increased the shifting from cash to virtual payments, the rapid increase in stablecoin market capitalization indicates more and more currencies are going digital.
According to the report, the increasing usage of stablecoins is also acting as a support for the Bitcoins price. The analysts highlighted the Tether (USDT) here, whose market capitalization increased from $4 billion to $10 billion within a year.
Following the technical data, the leading crypto asset is currently testing the $10.000 resistance. In the meantime, the analysts report that Bitcoin is mirroring the 2016 return to the peak.
At the time the situation was similar to the current: BTC was just after the second halving and in a third-year after the significant peak. The decline from 2014’s peak was nearly 60%, meanwhile, by the end of 2016, the coin’s price nearly matched one of the 2013 highs.
The current price chart depicts the third year following the crypto 2017 rally when BTC surged up to $20k. According to market experts:
Fast forward four years and the second year after the almost 75% decline in 2018, Bitcoin will approach the record high of about $20,000 this year, in our view, if it follows 2016's trend.
The analysts further highlight that since Bitcoin seems to be like a resting bull now, “something needs to go really wrong for Bitcoin to not appreciate.”