Mike McGlone of Bloomberg has stated that bitcoin can potentially reach the $100,000 mark over the next five years as it gets closer to becoming a store of value instead of a payment currency.
McGlone: $100K Could Be Here Soon
Over the past seven months, something rather strange and intriguing has happened with bitcoin. For a long time, the agenda of crypto serving as a payment system has been pushed with little to no success. While there are a few platforms out there that accept BTC as a method of payment, many stores and retailers have turned away from doing so given that bitcoin and its altcoin currencies still suffer heavily from volatility and price swings.
However, since the rise of the coronavirus pandemic, the price of bitcoin has been something on a role, largely because many individuals now see BTC as a means of protecting and hedging one’s wealth. With inflation on the rise and the instability of the stock market and other assets, many see bitcoin as the ultimate tool to keep one safe from a shaky economy.
McGlone feels that this has been what propels bitcoin into stardom, and it will continue to do so granted more people learn to attain this attitude. In a recent interview, he states:
That’s the key thing about bitcoin is that I don’t see what’s going to stop it from doing what it has been doing for most of its life, and that’s appreciating. The key thing it has been doing since it went to $100 and then to $1,000 and then $10,000, which has really been the consolidation price for the last three years, it just has a history of adding zeroes.
He further states that bitcoin has been exhibiting signs of strength and maturity this year like it never has before. Prior to this year, the coronavirus likely would have ravaged bitcoin and its counterparts, though it took only two months for the asset to recover from serious drops. In addition, he notes similar trading patterns between BTC and gold, which suggests it’s moving closer to gold-like status. He says:
It’s enduring, as bitcoin becomes a more mature and digital version of gold, just look at the 12-month correlation, it’s around 0.77 and the 52-week is around 0.5, the key fact is that it’s the highest ever. Bitcoin is following gold, gold’s made new highs, but its macroeconomic environment I think is quite significant: unprecedented debt to GDP, quantitative easing, negative rates, it makes things like gold and bitcoin look attractive.
Less Risk for a Stronger Asset
As the currency becomes more mature, McGlone says that bitcoin will become less of a risk. So much so that he can see many central banks adopting it in the coming future. He explains:
Higher prices actually increase demand and there’s no increase in supply.