Bloomberg is saying that all signs point to Bitcoin going on the significant bull run in 2020, the main inquiry is whether it will break the unsurpassed high of $20,000.
The most recent report from Bloomberg uncovers that the organization expects Bitcoin (BTC) to retest the record highs from 2017, and may even go as high as $28,000.
COVID-19 and Bitcoin
The report shows Bitcoin's strength in the midst of declining stocks. Also that COVID-19 has accelerated the maturation of Bitcoin as an asset.
What's more, it points to the ever-increasing appetite from institutional investors, and Grayscale, or GBTC, specifically, which has been consuming about 25% of the new supply:
“So far this year, its increasing AUM has consumed about 25% of new Bitcoin-mined coins vs. less than 10% in 2019. Our graphic depicts the rapidly rising 30-day average of GBTC AUM near 340,000 in Bitcoin equivalents, about 2% of total supply. About two years ago, it accounted for 1%.”
Reduction GBTC/BTC premium
Bloomberg finds the reduction of GBTC/BTC premium a telling sign:
“The steadily declining premium in GBTC despite strong inflows indicates supply being taken off the market, and maturation. On a 30-day average basis, the Trust’s 20% premium over its underlying net asset value compares with the historical mean of 39%.”
BTC to $20K or $28K?
The report states that Bitcoin will approach a 2017 high of $20,000 and may even reach to a new high- $28,000.
Something needs to go really wrong for Bitcoin not to increase in value:
“Last year, the high was about $14,000, which would translate into almost double in 2020 if rotating within the recent band, and mean little in the big picture.”
Last May, Tether's market cap was $ 4 billion. A year later, it was $ 10 billion. According to the report, Tether's rapid growth is also one of the reasons for Bitcoin's rise in price. The increased use of crypto assets is indicated by the increase in the circulation of stable coins:
“Interest in digital links to the dollar represents the need to transact and store value in the world’s reserve currency without an intermediary. We can’t help but draw parallels to the adoption of paper currencies throughout history as the world today moves rapidly toward digitization.”
With the halving and almost half of 2020 behind us, we should not have to wait long to see if Bloomberg’s forecasts come true.