The price of bitcoin (BTC) topped $25,000 for the first time ever, a mere week after breaking $24,000 for the first time.
- The price of the leading crypto currency continued its recent torrid run, setting a new all-time high of $25,005.53 before falling back to $24,971.23, up 6.28% on the day. Year-to-date BTC is up more than 240%.
- Institutional investors are perceived to be driving this record-setting run. Among them: Anthony Scaramucci’s Skybridge Capital ($25 million in December); MassMutual ($100 million in December); and Guggenheim (up to 10% of its $5 billion macro fund).
Investors will be questioning whether Bitcoin can continue its upward trajectory that kicked started from a lowly $4,000 back in March.
Trough to peak, Bitcoin surged by an even more impressive 506% and that was in just 3-quarters.
If we take the same trajectory, Bitcoin should hit the dizzying heights of $143,000 in late 2021 before any pullback.
For investors that time it right, they can convert a 2nd hand sedan into a 2nd hand supercar or a down payment on a palace.
As a result of the SEC move, Bitcoin lost momentum, with a pullback to $21,000 levels before steadying. The broader market also hit reverse, with the total crypto market cap falling from a high of $680.60bn to $590.85bn. It may not compare to the market collapse of early 2018, but it was still likely to have been a painful experience for those who jumped in too late.
Back in January 2018, the total crypto market cap had climbed to an all-time high of $761.74bn before its collapse to just $91.24bn in December 2018.
Looking at the market resilience this time around, Bitcoin and a number of the other major cryptos have held their ground.
While the late 2020 momentum rally drove the cryptos to record highs, there was no herd mentality sell-off. This should comfort existing investors and those sitting on the sidelines.
It may have something to do with the approach towards $1.00 levels. An impressive run from a March low of $0.1165.
For investors who entered the market early this year, there have been some tidy returns. More importantly, for those holding on or looking to enter or even reenter the market, further upside is plausible.
While regulators continue to linger and regulatory risk remains a key risk to the market, it isn’t all doom and gloom.
Adoption and greater acceptance should continue to drive demand for Bitcoin and its morphs.
The bigger question is, however, a much further can Bitcoin rise?
It may well depend on how the remainder of the year and early January pans out…
If Bitcoin can avoid a slide back to sub-$20,000 levels then the Bitcoin bulls will be setting the bar high. We have heard the talk of $1,000,000. Such a bar might be a little too high.
A momentum fueled visit to $100,000? Well, never say never.