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On February 17, local time in the United States, the price of Bitcoin, the world's most traded cryptocurrency , hit a record high of more than $52,000 after breaking through another psychological level less than 24 hours ago. In the previous trading day, Bitcoin broke through $50,000 for the first time. In the past 12 months (since March 2020), the price of Bitcoin has skyrocketed by 700%, and since 2021, it has also soared by more than 40%.
The most popular virtual cryptocurrency, Bitcoin, has a market capitalization of about 70% of the entire cryptocurrency market, pushing the market value of all cryptocurrencies to more than $1 trillion earlier this month.
Bitcoin has more than doubled in value since hitting a record high of nearly $20,000 in 2017 before the crypto market crashed, when it lost about 80% of its market value in a few months.
Although skeptics still warn that Bitcoin may be the world's largest asset bubble, more and more well-known investors and large banks are optimistic about Bitcoin. So, how high can Bitcoin rise?
JPMorgan is one of the latest firms to reveal its outlook for the cryptocurrency, predicting that it could reach $146,000 in the long term, though Bitcoin, known for its wild price swings, would have to significantly reduce volatility to reach that price.
Bitcoin could reach $146,000 in the long term as it competes with gold as an “alternative” currency, according to JPMorgan.
As of February 17, the value of a single Bitcoin exceeded that of a 28-ounce gold bar. According to Bloomberg data, the volatility of Bitcoin prices is currently five times that of the S&P 500 index in the past 20 trading days, and the volatility is six times that of gold.
Some analysts attribute Bitcoin's recovery to a number of factors, including more buying from large institutional investors. They also say Bitcoin's recent sharp rise is due to a large outflow of investors from gold, another popular inflation hedge.
However, as the world's largest cryptocurrency reached another price milestone this week, many analysts warned about the sustainability of Bitcoin's price amid such violent volatility, with gold enthusiast and cryptocurrency skeptic Peter Schiff continuing to insist that the cryptocurrency has no value.
Then, after Bitcoin hit a new high, JPMorgan Chase, which was previously bullish on Bitcoin, also said that the rise might not be sustainable. Some skepticism revived, believing that cryptocurrencies do not have a bright future. Peter Schiff added on social media: "Bitcoin at $50,000 is the world's biggest bubble."
We note that Schiff, CEO of Euro Pacific Capital, has often been critical of cryptocurrencies. The economist, who is famous for predicting the 2008 financial crisis, believes that "Bitcoin's bad end is coming. Bitcoin is a huge speculative bubble that is bound to burst, and those who buy it now will be tied up." He insists that only speculators will choose Bitcoin instead of gold.
Mark Haefele, chief investment officer of UBS Wealth Management, told Reuters on February 17 that we advise investors not to regard the Bitcoin phenomenon as a 'mainstream moment' for cryptocurrencies. Bitcoin is still far from becoming a widely used form of payment, and advises investors to be cautious before speculating.
In fact, the financial research team of BWC Chinese website has been tracking and reporting on Bitcoin since 2012, and proposed that Bitcoin has three mysterious genes. The first is the limited edition gene. The current number of bitcoins is reported to be more than 18 million, and the final number will only be 21 million; the second is the mysterious hidden gene of the founder "Satoshi Nakamoto"; and the third is the gene of the United States' ambiguous and neither humble nor arrogant regulation of Bitcoin.
Based on the fact that Bitcoin has grown from being unknown at the beginning (a few cents per coin) to being hyped up to tens of millions of times the value of $52,000, it is almost certain that Bitcoin, which has no physical or sovereign backing, is the biggest Ponzi scheme so far this century.
Once the inventor of Bitcoin is confirmed, it means that the Ponzi scheme may be exposed. For example, former World Bank President Jim Yong Kim said at an event in Washington, "As for the use of Bitcoin or some cryptocurrencies, we are also conducting research, but as far as I know, most cryptocurrencies are basically Ponzi schemes."
The United States is the birthplace of Bitcoin and the earliest market for trading. If the U.S. dollar is the surface part of the iceberg of international capital flows, then virtual cryptocurrencies represented by Bitcoin are the underwater part of the iceberg.
At the same time, we also noticed that the rise of Bitcoin is almost synchronized with the cycle of the US dollar. The development of Bitcoin has always been in line with the US dollar strategy. Bitcoin is simply a vest of the US dollar. Because it is inherently a tool for speculation, of course, this is also the fundamental reason why Bitcoin can grow and soar and plummet.
The United States is in the context of a debt-issuing economic model and the continuous decline in the credit of the US dollar. At the same time, many countries around the world are also seeking to get rid of the US dollar. Now, de-dollarization through cryptocurrencies is not only popular among oil-producing countries, but also among investors. This is mainly due to the global technological growth and the increasing popularity of the Internet. At the same time, the global financial market also reflects the trend of de-dollarization.
It is no coincidence that Iran, Venezuela, and Russia are all taking other steps to engage in global economic trade. For example, both Venezuela and Iran hope to circumvent international economic bans by issuing cryptocurrencies anchored to oil or gold to obtain capital flows and conduct economic activities with foreign countries.
Zero Hedge, a well-known American financial website, gave us the best explanation for this. The foreign media said that in the context of the de-dollarization of the global market, the birth of cryptocurrencies (represented by Bitcoin) is rooted in technological progress, the manipulation of global economic and financial rules, and the motivation to constantly try to weaken the economies of countries that pose a geopolitical threat to the United States.
The foreign media even boldly speculated that perhaps, the reliable alternative economic system formed by this anonymous, decentralized blockchain technology is the economic system that these market players subject to US financial sanctions have been desperately seeking, an economic system that can bypass the US dollar. This seems to be the root cause of the Bitcoin craze.
Finally, we have been reminding Bitcoin's blind enthusiasts on different occasions that they should heed the warnings and suggestions of some Wall Street people, because no one is more blind than those who refuse to face it. (BWC Chinese website) |
