Bitcoin is up almost 300pc, you’ve missed the dip
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If you’d ignored the haters and just bought some Bitcoin in December when it rock bottom, you’d be up 293 per cent right now.
The cyrptocurrency is currently sitting at $US12,649 ($18,000), up from $US3216 late last year.
While we hate to say we told you so, Stockhead did note in October the crypto hype cycle may be restarting.
Of course, you’d have had to ignore the fact that a year earlier it had topped out at over $US17,000 with a valuation based on fluff and nothing.
And conveniently forgotten all of the ASX flameouts that came with it, as every mining shell and biotech husk jumped into it.
But this time, so swears Apollo Capital digital assets investor Henrik Andersson, it’s different.
Andersson has been swearing it’s different for months, pointing to a gradual involvement by traditional institutions such as Fidelity and the NYSE in areas like clearinghouses and trading, and big investors like Yale and Harvard in actual investments.
“In the past six months months we had a number of positive announcements including JP Morgan launching a cryptocurrency, Facebook released a whitepaper for a cryptocurrency called Libra coin, Fidelity started trading and custody for Bitcoin, and Cambridge Associates released its first report on crypto assets in February,” he said today.
The NYSE may finally launch its Bakkt Bitcoin futures — delayed since the start of this year — in under a month.
But importantly, Andersson considers Bitcoin a “hard asset” like gold, as it there is a fixed amount of it available due to the founding algorithm limiting the total supply.
“In less than one year Bitcoin’s supply will be cut in half to 6.25 new bitcoins per 10 minutes; this will likely be bullish for the price,” Andersson said.
The Bitcoin protocol says that the reward for adding a block to the blockchain record will halve every 210,000 blocks, which is about every four years. Eventually, the reward will decrease to zero, and a limit of 21 million bitcoins will be reached around 2140, with record keepers being rewarded solely by transaction fees.
“And we believe a central banks globally are going from tightening to loosening, which will lead to a rally in hard assets. Bitcoin, like gold, is a ‘hard asset’ with its fixed supply of 21m.”
Already gold is benefitting from those macroeconomic factors, cracking the $2000 an ounce record.