The $20,000 Question: Will BTC Go to the Moon Again?

Published in

CyberVein

6 min readMay 28, 2020

The $20,000 Question: Will BTC Go to the Moon Again?

Backstory

The Bitcoin exchange rate reached $10,000 in late November 2017. Its price doubled less than a month after that. Propelled by its personal motto, “The sky is not the limit,” BTC was getting really close to its all-time high of $20,000. Why?

The launch of the Bitcoin futures Chicago Board Options Exchange (CBOE) most likely triggered this price boom. A week later, all was quiet, and altcoins were running the show. However, after a while, the king of crypto came back to life and resumed strong growth. It was suggested that this return happened due to expectations for the launch of the CME Bitcoin futures. The trading began on December 18, 2017.

Huge Influx of Traders

BTC’s overwhelming popularity among Asian traders led to a switch en masse from the traditional market to the digital one. None of this should be surprising, given the fact that many Asian crypto exchanges provided ten times the leverage. Potential gains from such decentralized trading systems would be several times higher than those from most traditional markets.

The explosive growth also affected the major cryptocurrency exchanges’ operations. Thus, Kraken, a Bitcoin trading platform, suspended the registration of new users. Every day, an awful lot of crypto lovers (about 50.000) registered on the exchange. This figure, paired with a record-breaking trading volume, exceeded all expectations. The team had nothing left but to struggle with such a burden on the server. They rolled out a large-scale platform update to address a number of issues that made the exchange extremely volatile.

The same thing happened with Bittrex. The leading blockchain technology provider temporarily suspended new-user registration, referring to the need to update the database. The reason was the same: the wave of newly signed-up members was too big to bear.

The BTC Party Continues

In 2017, the coin with a stellar reputation reached its maximum, but later, the price was adjusted by the market. Some believe that BTC will come back crashing to earth, and future investment makes no sense. Nonetheless, a further study in greater depth explains that BTC has just begun gathering momentum.

Traditional money will never come close to BTC. The decentralized super-organism was created to go up in value rather than down. An understanding of this phenomenon is crucial for investing in “magic internet money.”

You probably know that this pioneer in the world of crypto has a finite supply. While governments can print paper money any time they want to, quantitative easing has nothing to do with Bitcoin. Because it was created with a cap, it’s impossible to manipulate the supply and, therefore, the price.

What is more, the market entry of new coins is decelerating because the current mining process has become exceptionally difficult in recent times. To solve complicated math puzzles, miners either have to join a mining pool or purchase expensive hardware.

The mining reward is also becoming less significant. Gone are the days when you could be rewarded with 50+ virgin coins per block. Throughout BTC’s history, this amount has been reduced by half every four years, tumbling down to the current 12.5 BTC. The halving is a crucial moment from the investment point of view. Mr. Nakamoto thought that the fewer new coins entering the market, the better. This decision will lead to a great jump in BTC’s value in contrast to domestic currencies, which as always experiencing devaluation.

Since BTC’s development, its price has always gone up. Late in 2013, Satoshi’s brainchild shot up to $1,000 and then plunged. The digital gold has been overvalued due to speculation about what can happen in the world of finance.

Usually, high prices lead to widespread panic and chaos.

You might notice that the more costs go up, the more people buy. They are ruled by the fear of an even higher surge in prices. The result is mass hysteria. The figures, in this case, are artificially overvalued. When prices rapidly move up, hold off on investing. It doesn’t really matter whether we’re talking about stocks, real estate, or crypto.

Don’t forget about the hype. Back in 2013, the hype around the cash for the internet skyrocketed, and millions of enthusiasts joined the crypto space. At that time, one of the biggest buzzwords in technology was all over the news. Large companies discovered unlimited possibilities for the electronic currency. BTC became a hotbed of conversation, attracting attention from famous people. This hype stimulated demand. If the demand for something goes up when you only have a limited supply of it, it leads to meteoric price gains.

Share markets are highly volatile in nature. They are going through their most turbulent period in recent memory. If they fail, the safety of your funds starts with owning BTC. Financial markets and global currencies have undermined credibility when the market tanks. Taking a walk down memory lane, we can see that when people started investing money in gold and other tangible assets, the prices of those assets skyrocketed.

The Halving Is Done and Dusted. What’s Next?

By many accounts, BTC is bound to have tremendous success in 2020. Tom Lee, the CEO of Fundstrat, claims that the “hashcash” will cost $25,000 this year, reaching the $55,000 mark in 2022.

Petros Anagnostou, the founder and CEO of Crypto Solutions, believes that the digital currency is waiting for an incredible jump — we can expect even $50,000. A positive outlook indicates that there is a possibility that we’ll see a value of up to $100,000 per bitcoin at year-end.

Coinspeaker’s editor-in-chief, Daniel M. Harrison, predicted that the new money would reach the $2,400 mark in 2017. His new assumption is quite bold: BTC will climb higher to $30,000 this year. According to the cryptocurrency specialist, BTC is influenced by three factors: customer cost, emissions, and investment costs.

John McAfee, an information security pioneer, intends to hodl his bitcoins until at least the end of 2020 . Furthermore, in his view, 100% profit is just around the corner. McAfee expects that the BTC value will be hundreds of millions of dollars in 2140.

Jameson Lopp, the founder of bitcoinsig.com, has an even more drastic idea: $250,000 per coin. Mr. Lopp’s opinion reflects ambitious but achievable estimates of BTC’s progress expected by year-end. This figure is based on the daily monitoring of price movements for seven years (except 2014, which was affected by the Mt. Gox saga). The infrastructure engineer says that Bitcoin has always demonstrated a day-to-day value increase, and it won’t go without a fight this time.

Concluding Thoughts

We can’t predict the future, and neither can anybody else in the world, so don’t believe somebody who tells you otherwise. However, one thing we know for sure is that cryptocurrency doesn’t look like it’s going away anytime soon. If the equity market fails (the most likely outcome), the price of digital gold will soar. The BTC value will go on climbing. Take that fact into consideration if you are interested in online investment and want to grow your wealth in 2020.

Still, we will leave you with one point to think about. Historically, in any asset class, the people who have been burned the most were the ones who believed that nothing could go wrong.