The Bitcoin price has recently suddenly gained momentum and is currently trading over $9,300. With the upswing, more and more analysts are claiming that the Bitcoin price will reach new highs by 2021.
Bitcoin back in upswing after a sideways movement
The optimistic speculators of the Bitcoin industry are convinced that the crypto market will break out over the next few years, with the big upswing stimulating investors even more and Bitcoin bears fleeing. Well-known Bitcoin analyst PlanB said last week that it will reach a Bitcoin price of $100,000 before Christmas 2021.
As part of his stock-to-flow pricing model, he calculates the ratio between the existing inventory of the asset and the actual inflow into trading. Commodity assets, such as gold, have the largest stock-to-flow ratio of 62, which means that it takes 62 years to produce gold before today’s gold inventories are on the market. Commodities have a higher stock-to-flow ratio and have been rated scarce by investors.
If the computing power of the Bitcoin network does not change significantly, the reward for mining new Bitcoin blocks will drop from 12.5 Bitcoin to 6.25 Bitcoin in May of next year and the supply of new Bitcoins on the market will be halved. The Bitcoin and cryptographic industry quickly recognized the recent development as the reason for Bitcoin’s increase following the previous day’s Bitcoin increase.
The co-founder of Morgan Creek Digital, Anthony Pompliano, also forecast $100,000 by the end of 2021, indicating a weaker monetary policy on the part of the world’s central banks.