Bitcoin Bull Run according to Plan B
The Bitcoin bulls are in charge. On 17 December, the No. 1 cryptocurrency broke through the sound barrier at US$23,000 for the first time, continuing its lunar journey. With the price gains, there is no stopping the bullish forecasts. Opinion Echo.
In the days following Bitcoin all-time highs, Twitter is a fun place to be. I-told-you-so slogans are being bandied about like there’s no tomorrow. Understandable, after all, it took the No. 1 Bitcoin Superstar cryptocurrency a whopping three years to get to the level it was trading at in late 2017.
To be best prepared for the coming bull run, it can be worthwhile to take a look at past bitcoin cycles. Accordingly, an old acquaintance has put the gains from past bull markets on top of the price level. It is, you guessed it, PlanB.
R.I.P. „lengthening cycles“ and „diminishing returns“ pic.twitter.com/MWhr5JXjRB
– PlanB (@100trillionUSD) December 17, 2020
PlanB is the originator of the stock-to-flow model. An uber-bullish price model that links bitcoin prices to the scarcity of the commodity. With each halving, BTC becomes scarcer, leading to exorbitant price swings in the medium term. The question that concerns the Bitcoin community is whether the returns, i.e. the price gains, decrease with each halving compared to the previous cycle. While BTC gained about 10,000 percent from November 2012 to July 2016, it was „only“ 2,000 percent in the second halving epoch.
However, if BTC were to rise to PlanB’s predicted value of USD 288,000 by the end of 2021, this would mean a price gain of around 2,800 percent from the underlying USD 10,000. However, this is not compatible with the narrative of diminishing returns.
Nevertheless, PlanB sticks to its price prediction and writes on Twitter that one can say goodbye to the idea that cycles are getting longer and less profitable:
Guggenheim Partner: Bitcoin’s fair value is 400,000 US dollars
The continued bullish behaviour of Guggenheim Partners also caused a stir. The asset manager recently announced that it would invest up to 10 percent of its 5.3 billion US dollar Macro Opportunities Fund in BTC. Some of this has already been done. The accumulation had begun since BTC was at 10,000 US dollars.
Now Scott Minerd, chief strategist at Guggenheim, also explains why Bitcoin is considered a great opportunity. Internal analyses have shown a fair value of no less than 400,000 US dollars per Bitcoin, Minerd told Bloomberg. He was „delighted“ by the recent rally.
Minerd links his daring price prediction of 400,000 US dollars to Bitcoin’s similarity to gold.