- Bloomberg analysts say Bitcoin could surge to $500k or plunge to zero
- The USD rebounds from a multi-year support area
- Bitcoin and gold plunge as the US dollar recovers
Bitcoin News Today – The increasing demand and limited supply of Bitcoin has continued to increase its stance as digital gold. In a recent newsletter, Mike McGlone – an analyst at Bloomberg – said that the price of Bitcoin could either surge towards the $500k mark or it could fail.
Bitcoin (BTC) Could Hit $500,000 or Drop to Zero – Bloomberg Analyst
He has continued to say that Bitcoin is set to become digital gold. Once again, he pointed to how the increasing demand and limited supply of the digital currency were major adoption indicators and compared it to the bull run in 2017. The analyst said:
“Much of the broad crypto-asset market echoes 2017’s excesses, but the foundation is firming due to expanding decentralized exchanges (DEXs) and finance (DeFi). Limited supply vs. increasing demand is the bottom-line for Bitcoin, with macroeconomic underpinnings that support its march toward the market cap of gold, at a price of $500,000 by some estimates. Or it could fail.”
Bitcoin (BTC) Price Today – BTC / USD
The estimates that McGlone refers to are possibly based on assumptions that the market cap of Bitcoin will eventually reach equality with gold’s $9 trillion. When you divide that number by the maximum BTC supply of 21 million, it produces $428,571. Anthony Pompliano – co-founder of The Morgan Creek Digital – recently voiced a similar sentiment.
Nevertheless, the digital currency market is not currently moving in the direction many expected it to move in. The USD is gaining traction and Bitcoin and other cryptocurrencies are plunging lower.
Bitcoin Breaks Below Key Support As USD Rebounds from Multi-Year Support
The USD is rebounding from a key multi-year support area and the price of gold and Bitcoin are correcting lower. Furthermore, the warning of the European Central Bank against the growing euro is further catalyzing the rally of the USD. The price of gold and Bitcoin reacted negatively to the surging USD because both markets are paired with the USD. If the value of the USD goes up, the value of Bitcoin against the USD would go down.
Since the increase of the USD from its monthly open on September 1, Bitcoin has lost a significant fraction of its value. Gold has also declined significantly, losing about 1.9 percent of its value over the past two days. Bitcoin has plunged from the high of $12,086 to as low as $10,300. The decrease in the value of the digital currency over the past day is drastic, as Bitcoin is now deep in the red after a plunge of more than 8 percent over the past day.