The price of Bitcoin is likely to recover to at least $7,000 in the next week, with the wider cryptocurrency market receiving a major resurgence.
This is the bullish forecast from Nigel Green, the chief executive of deVere Group, one of the world’s largest independent financial advisory and services organizations.
It comes as the price of Bitcoin, the largest digital currency with a current market capitalisation of around $130bn, shot up by more than 20 per cent in 24 hours on Thursday.
Mr Green, who launched the deVere Crypto app in 2018, says: “Global financial markets – such as stocks, oil, currency, bonds and gold – experienced a massive sell-off this week. Investors who needed cash went into panic-mode about the coronavirus pandemic and whether governments’ and central banks’ policies are enough to mitigate the economic impact.
“Bitcoin was no different from any of these other assets – including the safe havens – it was just another asset to sell at the time.
“However, it has recovered significantly better than many other assets, jumping 20 per cent in 24 hours.”
He continues: “I’m confident that this upward trajectory will remain strong. The price of Bitcoin is likely to recover to at least $7,000 in the next week as the volatility in traditional financial markets, including fiat currency markets, looks likely to remain in the near-term.
“As such, a growing number of institutional and retail investors will seek to diversify their portfolios and hedge against the turmoil by investing in decentralised, non-sovereign, secure crypto assets, such as Bitcoin.
Price of Bitcoin to soar?
“In other recent times of market uncertainty, a growing consensus has been revealed that Bitcoin is becoming a flight-to-safety asset.
“Up to now, gold has been known as the ultimate safe-haven asset, but Bitcoin – which shares its key characteristics of being a store of value and scarcity – could potentially dethrone gold in the future as the world becomes increasingly digitalised.”
Mr Green adds: “Moreover, the upswing in Bitcoin’s price will remain on track because the fundamentals remain intact – namely that cryptocurrency is the future of money.
“Cryptocurrencies like Bitcoin are digital and global. Digitalization is often called the fourth industrial revolution and cryptocurrencies are digital by their very nature. Meanwhile, the borderless nature of cryptocurrencies makes them perfectly suited to an ever globalized world of commerce and trade.
“It is also about demographics. Younger people, who are of course the future, have always lived in a digital era, so using digital currency is going to be second nature.
“In addition, there will be an acceleration of institutional investment which is likely to be driven by greater regulatory clarity. More and more global jurisdictions can be expected to join the likes of Malta, Hong Kong, Japan and Switzerland in becoming crypto-friendly from a regulatory and pro-business viewpoint. The institutional expertise and capital will bolster prices significantly.”
The deVere CEO concludes: “Volatility in traditional markets, combined with a growing consensus of it being a flight-to-safety asset, plus its strong inherent fundamentals will ensure Bitcoin’s continued upward trajectory.”