Analysts believe that if bitcoin manages to break away from global stock markets and operate independently, it could reach $ 100,000 in the next 24 months. Bitcoin, on the other hand, has so far performed much better than the shares of companies operating in the stock market.
According to Kevin Telegraph, Tuur Demeester, founder of Adamant Capital Investment Company, said that if the correlation between Bitcoin and the Nasdaq Composite Index is broken, the digital currency could become available in the next 24 months. Reach $ 100,000. The Nasdaq Composite is a stock index that includes stocks of companies listed on the Nasdaq Stock Exchange and is of particular importance, such as the S & P500.
Demister uses the chart below to compare the growing market value of bitcoin with the stock index of US technology companies. According to the chart below, bitcoin is rising after long periods of stabilization and this could happen in the next 24 months.
More than a decade has passed since the introduction of bitcoin, and its price has risen from $ 0.06 to $ 69,000.
As you can see in the image below, the price of bitcoin has increased by about 64.50 million percent since 2010. The return of the Nasdaq index for the same period is 650%. As a result, the market value of bitcoin reached $ 755 billion, and the market value of the port of Nasdaq reached $ 28.68 billion.
Bitcoin has had significant correlations with shares of US technology companies over the years. For example, earlier this month, the correlation efficiency of bitcoin with the Nasdaq index reached 73%, which is close to its 50-year peak of 74% in 2020.
At the height of the risky market last month, the price of bitcoin fell below $ 33,000 from a peak of $ 69,000. Along with this reduction in prices, the US Federal Reserve also decided to quickly raise bank interest rates in 2022 for the article with staggering inflation, which reached its highest level in 40 years.
Matthew Siegel, head of digital asset research at VanEck Associates, predicts that bitcoin prices will fall along with the closing index and other indexes in the US stock market. According to him, the price of bitcoin may be even lower than the stock index. He also said that although fluctuations in bitcoin prices have declined in recent years, the Nasdaq 100 index (the top 100 stocks on the Nasdaq stock exchange) has deviated more than its five-year average.
This shows that the situation with bitcoin has gradually improved and has become a more secure and reliable asset against rising inflation. As a result, its correlation with risky assets such as shares of technology companies may continue to decline.
James Butterfill, head of research at research firm CoinShares, said bitcoin and technology stocks are currently significantly linked and that the performance of the digital currency is highly sensitive to rising interest rates.
What happens if the authorities make a mistake in implementing monetary policy? For example, what happens if the Federal Reserve raises bank interest rates too quickly in the face of rising inflation in the United States or if it doesn’t act fast enough? Such a situation is likely to be more in favor of bitcoin and less in favor of the stock market.
In addition, Joey Krug, CEO of Pantera Capital Digital Currency Risk Housing Fund, predicts that in the coming weeks the link between bitcoin and the shares of technology companies will disappear and that the digital currency will find its own independent way of trading. get started.
According to Demister, one of the reasons Bitcoin was able to move towards the $ 100,000 target was that despite pressure from a correlation with the Nasdaq index, it managed to stabilize near the $ 50,000 range.
Goldman Sachs also predicts that bitcoin will reach this price target by early 2022. The big investment company, which manages $ 1.2 trillion in assets worldwide, stressed that if bitcoin wins a share of the gold market, it could reach $ 100,000. It is worth mentioning that currently the market value of bitcoin is less than 6% of the market value of gold.
The publication A stock index shows that the price of bitcoin will reach $ 100,000 in two years appeared for the first time in Digital Currency.