Bitcoin investment: The Case for Bitcoin $10000 and why it’s most certainly wrong

Bitcoin investment: The Case for Bitcoin $10000 and why it’s most certainly wrong

Bitcoin News
March 22, 2022 by Diana Ambolis
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Wall Street, too, can’t seem to agree on where the biggest cryptocurrency is heading. This week, strategists at Stifel and J.P. Morgan expressed wildly contrasting opinions, underlining the difficulties of attempting to anticipate pricing for an asset that is inherently chaotic and unpredictable. Barry Bannister claims that cryptocurrency has historically responded to changes in Fed
10 Big Bitcoin's Economic Impact on the World

Wall Street, too, can’t seem to agree on where the biggest cryptocurrency is heading. This week, strategists at Stifel and J.P. Morgan expressed wildly contrasting opinions, underlining the difficulties of attempting to anticipate pricing for an asset that is inherently chaotic and unpredictable.

Barry Bannister claims that cryptocurrency has historically responded to changes in Fed policy, implying that the bottom of a protracted, tightening cycle may be much below present levels.

Crypto Federal Regulation and what Banks have to say

“The Fed is saying, we aren’t going to give you free money forever,” Bannister explains. “That may have a marginal effect this year, but in 2023 the Fed will probably go too far, and Bitcoin will get crushed.”

J.P. Morgan has a more mixed perspective. According to global markets expert Nikolaos Panigirtzoglou, Bitcoin’s fair value is currently $38,000. He arrives at that figure by assuming the Bitcoin will become four times as volatile as gold, down from five times at the moment. Bitcoin’s volatility, he says, is its largest barrier to entry into institutional portfolios as a gold alternative or supplement. With less volatility, demand and prices would grow.

Bitcoin would be worth $50,000 if it had three times the volatility of gold, according to one of Panigirtzoglou’s optimistic scenarios. That’s much below his “theoretical” upper-end price prediction of $150,000, which implies Bitcoin’s volatility is comparable to gold’s and that it outperforms gold as an investment asset. “Needless to say, such convergence…is unlikely in the foreseeable future,” he argues.

How American trading patterns will affect Bitcoin pricing: JP Morgan Chairman comments

So, in a year, how much will Bitcoin be worth? Michael Cembalest, J.P. Morgan’s chairman of markets and investment strategy, who oversees more than $3 trillion in assets, says, “That’s the last question I’d try to answer.”

This week, the Strategist, who won’t even guess, published The Maltese Falcoin, a critical assessment on cryptocurrency. The title references a 1941 film about a detective on a worldwide search for a precious statue that turns out to be worthless.

According to Cembalest, cryptocurrency also offers wealth. However, he does not believe Bitcoin investment can be used as transaction money since it is too volatile, poorly traded, and easily manipulated in price. He argues, “I believe in the store of value argument, but I don’t have a valuation tool, and the volatility is still way too high.” He points out that predicted cash flows may quantify real estate and equities. In contrast, bond rates are influenced by inflation, and commodities are influenced by supply and demand curves.

On the other hand, Bitcoin investment in the USA has few reliable benchmarks against which to measure its worth, according to Cembalest. Metcalfe’s Law, which states that the market value rises according to the number of users, is one of the most widely used metrics. According to Goldman Sachs, Bitcoin’s price appeared to be overpriced by that criterion in mid-2021, based on its network expansion.

However, Cembalest claims that Metcalfe is best used as a comparison tool, revealing the relative worth of competing blockchain networks. “It tells me if Bitcoin is cheap in comparison to Ether or Doge, but not in absolute terms,” he explains.

Bitcoin’s immutable software code raises the token’s supply at a pace equivalent to that of gold, which rises at a rate of 0.5 percent to 1% every year in the United States. Gold’s scarcity helps it keep its value during times of economic hardship and excessive inflation, and it’s not unreasonable to believe that Bitcoin may serve the same purpose in the digital age. However, Bitcoin may be forced to compete with gold and other safe-haven assets in the future. According to Cembalest, nations with foreign-exchange regulations, dual-currency regimes, governance, and corruption difficulties might benefit from Bitcoin as a store of value.

The key will be volatility; the longer it remains high, the less demand long-term institutional funds will have. On the other hand, reduced volatility may boost demand and, as a result, encourage higher Bitcoin prices as a gold substitute.

“A starving man isn’t picky about what’s on the menu,” Cembalest adds, adding that the gold analogy isn’t right.

Buying Bitcoin Satoshis for mere pennies: What is the minimum investment in Bitcoin? 

Speaking of a starving man, how little can you pay for crypto? What is the minimum investment in bitcoin that is required to get started? Users may acquire bitcoins for as little as two dollars on forums like Coinbase. However, investing with such little money is a lousy bargain because most platforms impose fees for moving, selling, or purchasing. That implies the fees might jeopardize your small investment. A minimum of $50 should be paid down. Even if you sought the advice of financial advisors, they might have told you the same thing. Before investing, it is vital to grasp the most fundamental principles and laws. They are as follows:

Invest an amount you won’t regret losing- If you wish to invest, never take out a loan. Most money loan companies will quickly approve your application if you promise to repay them within the agreed-upon time frame. You can only take such a risk if the product generates profits through its interest. If you neglect to consider this guideline while purchasing a digital system, you may have regrets.

Do you know that if you want to get additional money, you may work on active income for as long as you like? Nonetheless, the extra-passive income is the amount that lasts the longest. If you reach a stage where you have more passive cash than active cash, be sure you can idle and still have enough. The rich are the ones who can afford to do this since they can invest in a variety of financial items and receive higher returns.

 

How much should you invest in Bitcoin