As the stock market continues to be volatile, investors are moving to consider bitcoin in a similar way to assets like gold, according to a report by Bloomberg. Based on historical trends, the price of bitcoin is on its way to reaching the $ 100,000 mark in 2025.
The report is the fourth quarter edition of Bloomberg Crypto Outlook, and shows that bitcoin is likely to benefit from an increasingly volatile stock market and will be treated as a store of value, as with precious metals.
“In a year when US stock prices reached the highest market capitalization in relation to GDP, based on the most pronounced market capitalization since the Great Depression, it is logical to expect that most assets are increasingly subject to unstable stock market, ”says report by Bloomberg Intelligence senior commodities strategist Mike McGlone.
The report notes that the price of Bitcoin, which rose over a four-year period from about $ 1,000 in 2013 to $ 10,000 in 2017, could reach the $ 100,000 mark in 2025. That means Bitcoin can reach to its peak of $ 14,000 recorded in 2019, already this year. ” Or, says the report, "the new technology may fail, but our demand indicators are positive."
The report also shows that the market capitalization of the Grayscale Bitcoin Trust was "approaching an equity of 500,000 bitcoins", a number that is more than double the same period last year.
McGlone further states that Bitcoin, like gold, is experiencing increasing demand due to increased stock market volatility. He also cites a chart showing the highest correlation between Bitcoin and gold in 12 months since 2010.
Spencer Mindlin, a capital market industry analyst at Aite Group, declined to comment on the target price, but told Decrypt that what will really drive demand is institutional acceptance, as there is thus a higher level of comfort with the size and general environment that surrounds this class of assets.
He said there are two main areas that institutional investors are looking for clarity. The first is market capitalization.
"Market capitalization needs to grow to be worthy of attention from traditional institutional investors," he said. "If market capitalization does not exist to support the 1% allocation, they will not see it."
The second key factor for Mindlin includes issues such as easy access to the market and education. He said investors are still not fully comfortable with regulatory issues, asset security and other related issues.
But if the price continues on its current trajectory, investors can feel comfortable even without understanding the regulations.
* Translated and edited with authorization from Decrypt.co