Bloomberg intelligence strategist Mike McGlone expects bitcoin to perform similar to gold as it approaches $20,000, saying that the king crypto could add another zero in the coming years due to ongoing money printing and increasing demand.
In Brief
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McGlone believes bitcoin will correct at $20,000..
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The analyst said bitcoin could hit $170,000 in 2 years.
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The analyst cited the digital gold narrative and central bank money printing to support his argument.
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Bitcoin has seen increased institutional acceptance in 2020.
Bitcoin appreciated dramatically over the last few weeks and is currently stalling between $17,000 and $18,500 as the market ponders the next move. Gold recently broke all-time highs against the US Dollar, surpassing $2,000 per ounce before pulling back to $1,800 levels. According to Bloomberg Intelligence strategist Mike Mcglone, the same could happen with bitcoin.
In an Bloomberg interview on Wednesday, McGlone said: “Short term, $20,000 is pretty good resistance.
He continued: “I’m afraid it’s probably going to do what gold did. It got to $2,000, and then that’s been consolidating in a bull market since.”
Bitcoin surged to a price-point just shy of $18,500 on Tuesday before falling close to $17,200 shortly after, according to TradingView data. Since then, bitcoin has meandered at the $18,000 level, consolidating gains without withdrawing significantly. On a longer-term time-frame, McGlone expects bitcoin to continue its trajectory in the coming years.
Asked about what bitcoin could do next year, McGlone said: “The key thing about Bitcoin this year is very simple — it just added a one to the front of the number. Remember, it was around $7,000 at the end of last year. What I’m worried about — if you look at the past performance, which is potentially indicative of the future, next year or two could add a zero to the back of the number.”
With reference to $7,000 near towards the end of 2019, bitcoin added a one to that figure, making it $17,000 and then some. According to McGlone, future projections could see that figure adding another zero at the end of the number, where bitcoin would be valued at $170,000. During the interview, bitcoin had already breached $18,000, however. As such, adding another zero now would arguably mean a price tag of $180,000.
In the brief segment, McGlone touched on a number of important points, including a reference to bitcoin’s price swings. “Bitcoin is becoming a digital version of gold,” he explained. “One key point that’s happening this year is Bitcoin volatility has been declining,” he said. “In fact, it’s the lowest ever versus gold.”
The Bloomberg strategist also explained low bitcoin volatility against the Nasdaq, a mainstream market barometer. “Every other risk asset on the planet, volatility has been increasing, Bitcoin has been declining.”
Finally, McGlone mentioned that “institutional FOMO (fear of missing out)” on bitcoin is in line with rampant money printing, for which there is no end in sight. This year, bitcoin has been endorsed by mainstream financial players such as Microstrategy, Jack Dorsey’s Square and even PayPal.
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