Bloomberg Foresees Bitcoin Rallying To $400k This Year

Based on previous experience, analytics claim that the main world’s crypto will reach a record high of $400,000.

Bloomberg Publishes Bitcoin Raise To $400k
  • Experts at Bloomberg Crypto are predicting an unprecedented price spike for Bitcoin in 2021.
  • The analysts at the financial analytics firm believe that the price of Bitcoin could reach a record high of $400,000 in 2021, basing their hypothesis on historical data from Bitcoin halvings.
  • The months after the halvings of 2012 and 2016 saw Bitcoin gain around 55 times and 15 times its value, respectively. Bitcoin’s current rally, following the halving of 2020, could be construed as proof that history could repeat itself.
  • Bitcoin halving is an event in which the reward for the mining of Bitcoin is cut in half. The last halving, which occurred on May 11, 2020, resulted in a block reward of 6.25 BTC.

The world’s largest cryptocurrency by market capitalization and popularity, Bitcoin has continued its ascendancy to reach an all-time high of $61,683, fueling speculation that it will achieve even higher highs.

At the moment, the price of Bitcoin is around the $58,000 range, and analysts at Bloomberg Crypto have predicted a major price jump that could see the cryptocurrency trading at $400,000 before the end of 2021. Bloomberg’s analysts have based their predictions upon historical price data that shows rises a few months after a Bitcoin halving event.

Bitcoin To Reach $400k?

It may sound like a pretty outlandish claim for anyone to assert that Bitcoin could reach prices of $400,000 before the end of 2021. But when such a claim comes from a reputable analytics firm, it is worth paying attention to it.

Analysts at Bloomberg Crypto in a monthly report have predicted that Bitcoin could soar up to new highs of $400,000, and this assertion is based around the historical price reaction to Bitcoin halving.

Bloomberg Crypto observed that, according to their analysis, Bitcoin is in an identical position with the events of 2013 and 2017, which are the years preceding a Bitcoin halving event.

During those years, Bitcoin increased its value 55 times and 15 times, respectively. If history repeats itself, “to reach price extremes akin to those years in 2021, the crypto would approach $400,000, based on the regression since 2011 high.”

While the analysis by Bloomberg is pegged to historical data and subject to a degree of probability, it is pertinent to note that the current Bitcoin price rally is linked to the halving that occurred in May 2020, which has seen Bitcoin riding on the wave of a strong run.

On the Flipside

  • Despite the bullish prediction by Bloomberg analysts, the inflow of institutional money for Bitcoin fell by 10% in Q1 of 2021.
  • According to Kaiko, the BTC-USD and BTC-USDT trading ratio can indicate institutional inflows into crypto.
  • Q4 of 2020 saw a spike in the acquisition of Bitcoin, with the likes of Microstrategy, Square, and other institutional investors embracing the asset.

Bitcoin Halving And The Price Run

The prediction by Bloomberg hinges upon the bitcoin halving event and the spike in price that follows in the next year. Bitcoin halving, as the name implies, is the halving of the rewards of mining blocks after a set of 210,00 blocks have been mined.

This event happens once every four years. The last halving event, in May 2020, brought the reward from 12.5 Bitcoins to 6.25 Bitcoins. The next halving is scheduled for 2024.

Between 12 to 18 months after the Bitcoin halving events of 2012 and 2016, Bitcoin recorded astronomical gains of around 50 times its initial value at the beginning of the halving.

According to the report by Bloomberg, “The year after a supply cut (halving) is what 2021 has in common with 2017 and 2013, along with subdued volatility.” The cryptocurrency’s soaring prices should not come as a surprise as history tends to repeat itself.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Deno Trajcevski

Deno Trajcevski is a cryptocurrency and blockchain content creator who specializes in the field of GameFi and covers a wide range of topics on the subject. From Play-to-Earn (P2E) mechanics to the latest news, announcements, and exploits within this crypto sphere, Deno reviews and analyzes the movement and developments in gaming daily. If a project implements GameFi in its lineup, he is there to review the project.