Cryptocurrencies
Bitrcoin

The bitcoin price pulled back from its all-time high this weekend, weighed down by a bitcoin cash price surge and disagreements over the SegWit2x scaling proposal.

Burgess COMMENTARY
There is a need for data security and blockchain is a technological foundation for better security, and that is valuable. Bitcoin has a quite modest utility / purpose as a way to move 'money' around the world from entity to entity. None of this justifies a valuation in excess of $4,000, and confirms once again that markets are a very bad way of pricing anything ... tulips, South Sea real estate, ... bubble after bubble after bubble. Bitcoin has become nothing more than an out-of-control casino ... and other cryptocurrencies are attempting to replicate this unreal investment frenzy. But blockchain is an important technology ... or can be. Conventional money and related monetary / fiscal economics is constraining global progress in ways that are not necessary. When I learned academic economics (50+ years ago) the world economy was still constrained by low productivity and not enough people with skills and there was a shortage of goods to improve quality of life ... but fast forward to now and there is the productivity for everyone to have a very much higher standard of living and there is a big surplus of people to do all sorts of work. The technology and engineering is available. What is missing is a mechanism to make it possible to do work that is valuable and does good, either social good or environmental good! .We only have a mechanism that facilitates doing things that make profit. This system works for example for a sick person who is rich, but does not work for a sick person who is poor. Making someone healthy is good in both cases, but in only one case is there a profit incentive for the service to be carried out. A huge amount of 'money' appeared as if by magic when the financial system was about to crash almost 10 years ago ... so one has to wonder why something similar could not be done to make sure that (1) society as a whole does not crash and (2) the environment continues to function in ways that will support life into the future. It seems to me that blockchain could be used to enable complementary currencies that are based (backed, if you will) on the idea that there are important 'potentials' that can be realized if only there were to be a medium of exchange that is available to give liquidity to enable the release of these potentials. Issues like government 'debt ceilings' had a role in 19th century finance, but surely better solutions should be possible in the 21st century. Everywhere I have worked in the world in the past 50 years or so, there have been nice people, often incredibly poor in material terms. There is now absolutely amazing technology. Put the two together and there is the potential for a really wonderful world! Peter Burgess ... http://truevaluemetrics.org
Peter Burgess

The bitcoin price pulled back from its all-time high this weekend, weighed down by a bitcoin cash price surge and disagreements over the SegWit2x scaling proposal.


bitcoin price Bitcoin Price Chart from Coinbase

However, Wall Street strategist Tom Lee believes that the long-term prospects of the bitcoin price remain quite promising. As CNBC reports, Lee–who co-founded Fundstrat Global Advisors and is bearish on the outlook for the stock market–wrote a note to clients establishing a mid-2018 bitcoin price target of $6,000. He also forecasts that it could rise as high as $25,000 by 2022.

Bitcoin Price to Reach $6,000 in 2018

He says several factors will fuel bitcoin’s continued rise to $6,000, including a 50% increase public adoption of bitcoin as a store of value and mainstream financial investments in cryptocurrency:

We see bitcoin as gaining from institutional sponsorship, improving transaction platforms and ultimately, greater public adoption.

Pointing to LedgerX and CBOE Holdings, which have both receive regulatory approval, Lee says the availability of cryptocurrency options and futures trading will increase overall bitcoin transaction volume.

[This] implies significant rise [in] institutional holdings of Bitcoin in next 6-8 months given recent approvals….No doubt, this will lead to an increase in overall transaction volumes for bitcoin.

Central Banks Could Acquire Bitcoin

Lee’s comments echo a recent Goldman Sachs note, which advised that it is “getting harder” for institutional investors to ignore cryptocurrencies. He adds that even central banks may begin acquiring bitcoin if it reaches a market cap of $500 billion, which will happen if the bitcoin price reaches about $30,000.

While one may say this is preposterous to say central banks would own bitcoin — we believe that Central banks would view crypto currencies differently if Bitcoin’s aggregate value exceeded $500 billion

That said, Lee anticipates short-term volatility for the bitcoin price heading into late August of this year.

Short-term traders should be prepared for another volatile consolidation period heading into late August given the XBT is nearing our next resistance levels with daily/short-term momentum becoming overbought.

Other Bitcoin Price Forecasts

A number of financial analysts have issued bitcoin price forecasts. Sheba Jafari, a chief technical analyst at Goldman Sachs, believes the bitcoin price will near $5,000 but crash as low as $2,221 as its fifth wave ends. Stock researcher Ronnie Moas believes bitcoin will beat Lee’s target and cross $7,500 in 2018, and one Harvard academic believes a unique application of Moore’s Law could result in bitcoin breaking through $100,000 in 2021.
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Posted in: Bitcoin Analysis, Bitcoin Price News, News Tagged in: Bitcoin price, cboe, fundstrat, ledgerx, tom lee

Posted by Josiah Wilmoth ... Josiah lives in rural North Carolina with his wife and son. He is a full-time freelance writer and a former ancient and medieval literature teacher. Email him directly at josiahwilmoth(at)gmail.com.