Today I propose an article that was published on the Nasdaq website.
The author is the CEO of Celsius Network, a London-based cryptocurrency company that also operates in the United States.
I believe it is useful to understand how the Bitcoin world is evolving as seen by an operator in the sector.
By Alex Mashinsky, CEO of Celsius Network
Whether done through financial analysis or chewing gum, all bubbles must continually grow in size due to overwhelming behavior: new capital coming in from retail investors or institutions, or air. The main difference between these types of bubbles is that an oversized financial bubble is much scarier when it bursts than one made with gum or soap.
For those who haven't watched Bitcoin closely, an explosive bubble in 2017 rocked the market and caused the withdrawal of most of BTC's retail investors. However, now Bitcoin is increasing as there are more buyers than sellers entering the market. Part of this has to do with the halving of new bitcoins issued (every 24 hours, NDT), an event that occurred in May reducing the total supply of new bitcoins by 50%, and which set BTC inflation. at 3%, but more importantly, it must have something to do with 2020.
This year saw some of the biggest names in finance enter the cryptocurrency sector but also record levels of confusion over the future of the dollar by the Federal Reserve, leading investors to seek out new unrelated assets.
This year alone, the Fed has pumped $ 9 trillion new dollars into the US economy or, to put it another way, more than 20% of all dollars ever created, and this liquidity has inflated equity markets to new highs.
The coronavirus pandemic has created the most favorable environment for accelerating the global digital economy, so it is no wonder that Bitcoin and other digital currencies have been able to show the best of their use cases. When the government prints more fiat money, the value deflates; however, as the new Bitcoin offering decreases and more users want it, the value continues to rise. A bitcoin will always be the same as a bitcoin, but when the number of users grows from 100m to 500m the value of each Bitcoin in dollars grows more than 5 times due to the network effect of any monetary system.
Growth and awareness, based on the latest bull run, have increased. People who entered the cryptocurrency world in 2017 are more likely to double in 2020, and people on the sidelines who 'lost' the 2017 bull run are more likely to enter this period. In 2017, we had an unexpected surge of revenue from retail investors due to hype and FOMO ("fear of missing out").
Currently, the numbers indicate that FOMO is not present (LINK Google) and that the buy-in is much more distributed now among professional investors looking at institutional products such as Grayscale, retail users via PayPal and Cash App (article on CNBC) and the existing Crypto community.
My company, Celsius Network, which mainly represents retail investors, has doubled its assets under management to over $ 2.2 billion in less than 6 months. Since 2017, we have been promoting the need to "cross the chasm" towards mass adoption and affirm that Stablecoins are our best opportunity to get there. While others were betting on Security Tokens, Libra, NFT, we focused on performance as the second cryptocurrency killer-app.
We are now witnessing the passing of the baton from the speculators who dominated the 2017 boom to the mass adoption brought by institutions, family offices and retail. Infrastructure has finally arrived, on a large scale, to accommodate consumers and businesses. It has never been easier to buy, sell and invest in cryptocurrencies. Many of the new waves of executives in the cryptocurrency world that have increased since 2017 believe in educating users rather than intimidating them. This mindset has led to a greater focus on usability and the onboarding of new users when we see these large spikes of new retail investors.
The real question now is not why the growth is happening now, but whether it will last. Since February of this year, I have forecast new all-time highs for 2020, and now that we have reached new highs on November 30, even though there are no guarantees, I am confident that by the end of 2021 we will see bitcoin break $ 30,000. Even though prices can drop by as much as 50% over the next 12 months because too many people try to sell their coins at the same time, I don't think the impulsive sale for political, pandemic or economic issues will stop this climb and we will see BTC above $ 200,000 by the end of. 2025.
Bitcoin's price hike was inevitable and in five years Bitcoin will be worth up to 10 times more than it is today. 2020 gave us a glimpse of everything that Bitcoin's store of value demonstrates, from printing the Fed's money to shutting down the economy, all combined with the bitcoin scarcity effect. If you think this is just another bubble, that's fine. However, it will not burst, but will float triumphantly on the moon as all other dollar-denominated assets continue to decline in value.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Original article link on Nasdaq.com
https://www.nasdaq.com/articles/why-you-shouldnt-be-surprised-by-bitcoins-rally-2020-12-01
