Bitcoin Now at $93,000 All-Time High – Is It Too Late to Buy BTC?

Bitcoin is pumping itself from one all-time high to the next this week, the new level is a good $93,000. Investors are asking themselves: is this already the peak for Bitcoin or should we invest even more now?

Bitcoin (BTC) has been on the hunt for records since Donald Trump’s election victory, and yesterday evening a new all-time high of over $93,000 was recorded

The price curve of Bitcoin has reached new highs almost every day since the US election with Donald Trump as the winner. Does “up only” now really apply to the leading crypto currency BTC and does it still make sense for investors to get into Bitcoin or buy more?

Matt Hougan, chief strategist at Bitwise, has recently published an exciting analysis on this question , focusing on medium and long-term Bitcoin’s future prospects. Bitwise is one of those who first launched Bitcoin ETFs in January – so Hougan is close to the action. He now argues that up to prices of $500,000 per BTC, it is “early” to invest.

The currently often-cited price target of $100,000 for BTC seems like it’s “around the corner,” writes Hougan, and then explains why he expects completely different price regions for Bitcoin:

– The Trump presidency, like other governments around the world, will not be able to avoid increasing the mountains of debt. Experience shows that in such an atmosphere, the demand for stores of value increases – and in addition to gold, BTC is now also coming into play.

• Gold is already accepted in public opinion as a store of value and anchored in central banks, says Hougan. With Bitcoin ETFs, however, it is still sold as big news when, for example, pension funds invest or large hedge funds start to rate BTC positively.
• Only when Bitcoin appears “as boring” as gold as a store of value will the price curve’s rise be stopped, argues Hougan. He estimates the market capitalization of gold at around $18 trillion worldwide, while Bitcoin’s is just under $2 trillion.

– The two leading stores of value, BTC and gold, have a combined market capitalization of $20 trillion. Hougan predicts that this capital will be split roughly 50:50 between Bitcoin and gold in the medium term.

– Almost 20 million of the maximum 21 million Bitcoin are already in circulation. This combined with an expected market capitalization of $10 trillion leads Hougan to $500,000 per BTC.

• But who on the buyer side should accept such prices for Bitcoin, asks Hougan? This is where the central banks and governments come into play again, which, according to his figures, hold around 20 percent of the world’s gold reserves, but only 2 percent of all Bitcoin.

– Donald Trump’s proposal for a state Bitcoin reserve for the USA is already available as a bill submitted by Senator Cynthia Lummis. According to this, the USA should purchase one million Bitcoin in the next five years, which would be almost 5 percent of all BTC.

• And if the USA makes Bitcoin a basis for its monetary policy, similar to gold, other countries will have to follow suit, says Hougan and others. The gap between the current Bitcoin prices and his projection of $500,000 closes here seemingly effortlessly and mathematically comprehensible.

Conclusion: BTC potential does not end at $100,000 – forecasts

Bernstein recently made headlines with the new price target of $200,000 per BTC and the recommendation “Buy everything that’s there”. Hougan from Bitwise naturally also has a corporate interest in ensuring that the current Bitcoin boom does not end abruptly. But with a US government reserve in BTC, the framework conditions for the valuation would actually change significantly, and we are also reminded of recurring thought experiments on Bitcoin as a world currency.

Hougan also throws the mark of $1 million per Bitcoin into the ring, but at the same time emphasizes that there is not even a guarantee of $100,000 as the BTC price and his forecast is not without the “ifs” that include gold, stores of value and central banks or governments for the future of Bitcoin.

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(Featured image by Art Rachen via Unsplash)

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