- Analysts believe that Bitcoin’s value will boom in 2020 owing to the fixed supply and increasing demand amid heightened ambiguity across the world
Bloomberg’s analysts reported that Bitcoin which is gaining traction as a reliable store-of-value is likely to soar in 2020 owing to its fixed supply and ever-increasing adoption. However, the competition between Bitcoin and other cryptocurrencies will persist, which again, more often than not, fuels progress and innovation, as many believe.
The analysts believe that the value of Bitcoin is likely to reach the 2019 high of USD 14,000 due to various reasons. We have already witnessed the Bitcoin rally, with a 23% gain in value, a week into 2020, amid the increased geopolitical conflicts between the US and Iran. However, as assets such as Bitcoin, gold and oil rallied, stock futures pulled back simultaneously.
As for this year, the estimated increase in Bitcoin supply is projected at 2.5%, which is expected to drop to less than 2% in 2021. In adherence to the Bitcoin protocol, the reward for adding a block is expected to reduce from 12.5 to 6.25 BTC which is likely to add to the supply pressure as the limit of 21 million approaches.
While drawing a comparison between Bitcoin and gold, the analysts stated that as gold’s price matures in 2020, so should the “digital version of the metal”. The report stated:
“Our takeaway is straightforward: Bitcoin is winning the adoption race, notably as a store-of-value in an environment that favors independent quasi-currencies. […] Bitcoin should again outshine most crypto assets in 2020 as the unique and appreciating digital version of gold.”
Bitcoin price, futures volume and open interest are also factors contributing to the appreciation.
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