Bitcoin might see additional upside and surge as excessive as $100,000 by the center of 2022, in keeping with Antoni Trenchev of cryptocurrency lender Nexo.
The world’s largest cryptocurrency by market cap was buying and selling at $46,170.43 as of 8:42 p.m. ET Monday, in keeping with knowledge from Coin Metrics.
“I assume [bitcoin’s] going to succeed in $100,000 this 12 months, in all probability by … the center of it,” Trenchev, co-founder and managing associate at Nexo, informed CNBC’s “Avenue Indicators Asia” on Monday. The agency claims to be the world’s largest lending establishment within the digital finance business, in keeping with its web site. The corporate has issued greater than $6 billion in credit score and manages belongings for greater than 2.5 million customers globally, it mentioned.
Bitcoin has largely been a winner within the pandemic period, rising greater than 60% in 2021 regardless of being far off its file excessive of round $69,000 earlier that 12 months. Compared, the S&P 500 rose almost 27% throughout the identical interval, whereas the Dow and Nasdaq gained 18.73% and 21.39% for the 12 months, respectively.
However not everyone seems to be as bullish as Trenchev.
Some consultants have warned that bitcoin may be poised for a steep drop in the coming months. Carol Alexander, professor of finance at Sussex College, mentioned she sees bitcoin tanking as little as $10,000 in 2022, nearly wiping out all of its features previously 12 months and a half.
On his half, Trenchev mentioned there have been “two easy causes” why he sees large features forward for bitcoin.
One is that establishments are “constructing out their treasuries” and filling it with the cryptocurrency, he mentioned, with out offering any examples. Corporations akin to MicroStrategy and Sq. are amongst identified examples of firms which have purchased huge quantities of bitcoin.
One more reason is his prediction that “low-cost cash” is right here to remain — which can be a boon for cryptocurrencies.
His feedback come regardless of expectations the Federal Reserve could raise interest rates several times this year for the first time in the pandemic era because the U.S. central financial institution seeks to fight inflation. The Fed was amongst main central banks that took unprecedented financial easing steps in 2020 to maintain monetary markets afloat in the course of the early days of the pandemic.
Admitting his “contrarian” view of lasting straightforward financial coverage, Trenchev mentioned most individuals seemingly “received it incorrect” of their Fed fee hike expectations.
“I fairly frankly assume that as quickly as we see a fee hike, it will be a dip into equities and the bond market — and fairly frankly, the previous few years, we have not seen a lot political will to … energy by means of any kind of correction within the conventional monetary markets,” he mentioned.
— CNBC’s Ryan Browne contributed to this report.