with Bitcoin touching the $28,000 mark this Sunday, analysts are looking at $30,000 Was a possible peak point in the short term.
Bitcoin closed Monday at $27,040 on Coinbase after it briefly touched $28,000 the previous day. Bitcoin is now up 11% in the last seven days and 269% since the beginning of the year.
Analysts predict $30,000 could be the probable short-term top. Vijay Ayyar, the head of business at Singapore-based cryptocurrency exchange Luno, told Bloomberg that a pullback could definitely happen. "But the magnitude is lesser. We might only see a 10% to 15% drop," Ayyar said.
Bloomberg's cross asset team reporter Eric Lam attributed the spike, which happened after Christmas, to Bitcoin's 24/7 markets. "There's probably a lot of discussions around the dinner table about cryptocurrencies," he said. While $30,000 is the target because it's a round table, he warned that the current price action is in unchartered territory. "It's dangerous to put a number on it at this point."
The current macroeconomic situation due to the COVID-19 pandemic and the weakening dollar prove a strong narrative for investors to consider Bitcoin as a hedge against inflation. While Bitcoin hit near $20,000 in 2017, the current bull run is different because of the new investors driving the price up. A previous report said institutional investors are behind the recent price action. Some of these institutions have publicly confirmed that they acquired Bitcoin. Paul Tudor Jones said he put 1% of his fund into Bitcoin. MassMutual, a 139-year old institution, has invested $100 million, while Guggenheim Investments put up to 10% of its $5 billion funds into the cryptocurrency.
Ayyar told Bloomberg that investors are shifting away from other cryptocurrencies after the U.S. Securities and Exchange Commission recently charged Ripple with illegal sale of securities. The SEC said XRP, the cryptocurrency closely associated with Ripple, is a security, and therefore, its continuous sale is illegal.
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