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Bitcoin Price Could Surge To $50,000 By Mid-2021: Here’s Why

Avatar Nick Chong 2 months ago

Since Bitcoin (BTC) hit $20,000 for the first time in December 2017, analysts have been wondering when the cryptocurrency will break its next big price milestone next. The closest round-number milestone from $20,000 is arguably $40,000 or $50,000.

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While $50,000 is 450% higher than the current price of just shy of $9,000, a model backtested to be quite accurate in the volatile crypto market suggests that Bitcoin will hit this auspicious price point in the middle of 2021. Here’s more on why.

Bitcoin Will Likely Hit $50,000 In 2021, Model Predicts

In Spring of last year, a user on Twitter named PlanB suddenly rose to notoriety within the cryptocurrency space when the analyst, later revealed to be a quant at a European institution, revealed a revolutionary Bitcoin price model.

The model, dubbed the stock-to-flow model, equated Bitcoin’s scarcity, derived from the above-ground supply divided by the rolling issuance of the coin, to the asset’s market cap. It determined, to a 95% R squared, that after the BTC block reward reduction in May 2020, a coin will have a fair value of anywhere between $55,000 to $100,000.

While Bitcoin will seemingly eventually achieve that price point due to the historical accuracy of the model, the model does not predict when the surge will occur.

GeertJancap, a Twitter user interested in disruptive technologies, recently tried to solve this mystery of when should Bitcoin trade at parity with the stock-to-flow model.

He noted in a semi-crypto-viral tweet that per his transfer function model of Bitcoin’s price, BTC’s price will catch up to PlanB’s lofty model a year after the halving in the middle of 2021.

 

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Others Want it Sooner

While $50,000 by mid-2021 would already be an astounding achievement for a market as uncertain as Bitcoin, some want this milestone (or at least a price around $50,000) to come even sooner than 18 months from now. Much sooner.

Related Reading: This Late Night Host Just Exposed Millions to Bitcoin, Again

Ex-Goldman Sachs partner Kelvin Koh, who is now a partner at blockchain advisory and investment fund The Spartan Group uses, recently noted on Twitter that he is certain BTC’s recent move from $7,000 to vaguely $9,000 is “just the start” of something much bigger.

Something bigger, he claimed, being his sentiment that this year, the price of BTC will hit $40,000, some 400% higher than current prices. He specifically cited his firm’s belief that there will be a “supply crunch post halving.”

There’s also the chief executive of Nexo, who said that BTC could hit $50,000 by the end of the year, as crazy as this may sound.

Halving Bullish Regardless

Whatever the case, the halving has seemingly been proven to be bullish for BTC in the long term. 

Melik Manukyan, a prominent Bitcoin commentator and engineer, recently posted the Twitter thread below, showing that the scarcity of the leading cryptocurrency should lead to dramatic price appreciation with a multi-month lag following the event.

The engineer remarked that halvings will have a large impact on the supply-demand economics of the BTC market, which should eventually result in prices heading higher to a decrease in mined supply being sold on the market.

Featured Image from Shutterstock
Nick Chong

Since 2013, Nick has shown interest in Bitcoin and cryptocurrencies. He has since become involved in the industry as a full-time content creator, working for NewsBTC, Bitcoinist, LongHash, among other outlets. Aside from covering...

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