(Noted News) — Three years after taking the world by storm in an unexpected rally from zero to nearly $20,000, Bitcoin is making headlines again with another sizeable rally to challenge the old highs.
Once strongly associated with hackers, cybercriminals, and gamblers, Bitcoin and cryptocurrencies are getting mainstream media coverage and shout outs from big banks, financial institutions, and politicians.
In their Flows and Liquidity Report, JP Morgan said that institutions were rushing into Bitcoin at an even faster pace than they were in the third quarter, and are now playing a bigger role in the price movement than commodity trading advisors. They also noted that $1.6 billion worth of Bitcoin was purchased from Square’s Cash App.
Last month, the analysts from the bank also said that the price of Bitcoin could easily challenge gold by tripling in price.
This is a sharp U-turn from what JP Morgan CEO Jamie Dimon said in 2017 about Bitcoin, calling it a “fraud” and telling investors, “if you’re stupid enough to buy it, you’ll pay the price for it one day.”
JP Morgan’s bullishness on Bitcoin is in part due to Paypal’s offering of it on their platform, and Square’s decision to add $50 million worth of Bitcoin to their reserves. There have been criticisms of these moves from the crypto community who say that the Bitcoin offered on these platforms will not be genuine Bitcoin, but rather “paper Bitcoin” settled off the blockchain. In general, though, it is being welcomed as a mainstreaming of the once-obscure asset class.
Other notable financiers who have become outspoken Bitcoin-bulls are Paul Tudor Jones, Stanley Druckenmiller, and Bill Miller.
In an interview with Kitco News, former White House press secretary and billion-dollar hedge fund manager Anthony Scaramucci said that his firm was doing his due diligence on cryptocurrency, and expects it to become “digital gold.”
“It’s too volatile for you not to consider it a risk-asset or an asset that’s loaded with a lot of volatility. Could it become a store of value? Could it be ‘digital gold?’ Yes, I do think that. I think there is promise in the digital asset space.
The big question for me always was, ‘is this a tulip bulb?’ or ‘are we doing something that’s much ado about nothing?’ And I think I’ve come to the decision, as well as my investment management team, that no, there is something here, there’s some tangibility here and it may be a future store of value… Particularly in an age where fiat currency is being consistently manipulated in a coordinated way by the central banks.”
For many analysts, bullish forecasts for Bitcoin go well past the $100,000 level and into the $1 million range, citing a perfect storm of lack of supply plus growing demand.
Max Keiser, Wall Street veteran and long-time crypto bull, said that institutional investors will find ways to monopolize the crypto market and push the price of Bitcoin to $1 million.
“The demand for Bitcoin is growing almost exponentially while supply is mathematically locked at 900 a day and in fact, in 2024, the supply gets cut in half again to 450 a day.
This is why I think institutions that are buying bitcoin will do so directly from miners and the public won’t have a chance to buy any. The public will be shut out as the price rockets to $1 million per coin… Meanwhile, Generation Z who bought lots of Bitcoin when it was under $100, will be the new global power elite. The world order is about to flip.”
Many analysts and crypto enthusiasts note that while the supply of government currencies is constantly expanding and will expand at greater rates in the future, Bitcoin has a hard cap on its supply, with less and less being created until it eventually stops completely.
Though gold has traditionally been used as a way to hedge against the debasing of our currencies, some say that Bitcoins portability, security, and massive upside actually make it a much better mechanism.
Jeff Booth, best-selling author and founder of tech company BuildDirect, said in an interview last September that gold became useless to people fleeing war in WW2 because it was impossible to take with them.
“Going back to World War II, people sewed gold into their clothes to try to leave as refugees with something and would drown because of the gold in their clothes. So that becomes a less effective way to protect your wealth than today where you can remember 10 words and move anywhere with Bitcoin. So the portability alone of Bitcoin for safety reasons becomes paramount. It’s a life raft.”
He also believes that eventually, all currencies in the world will get pegged to Bitcoin.
“So the government says, ‘We are going to make your cash worthless.’ Why do you think populations are rising up? They’re after the protection of value from governments’ policies that are destroying their currencies.
It could happen in a number of different ways, but I think in the end game, I think that currencies will be pegged to Bitcoin”