Why Bitcoin Will Leap to $90,000
Two days ago a German state-backed bank BayernLB issued its research regarding the Bitcoin price and the future forecasts regarding the matter. It states out that the forthcoming BTC halving effect is underestimated. The report also says that it was not priced into the current $8,300 and Bitcoin will leap to $90.000 soon.
Better Than Gold
The bank report tells that gold has got its stock-to-flow ratio high as it is now “fighting for it through centuries”. At the same time BTC has a chance to reach stock-to-flow ratio like that till the end of 2020 that is in upcoming year.
Manuel Andersch, being a senior FX analyst at the Bayerische Landesbank explains the stock-to-flow ratio as a way to check “hardness” of the asset. During centuries gold was a commodity with the highest stock-to-flow ratio possible. And of course it was used as money because provided the best of all the alternatives value transfer, increasing over time. The stock-to-flow ratio of gold means that the total amount of gold kept in reserves is divided by the amount of asset, having been produced during the previous year while counting.
In the report the author forecasts that the current price of the cryptocurrency will increase dramatically in 2020. So Bitcoin will leap to $90.000 already in May. He also adds that if stock-to-flow ratio for Bitcoin at the moment of May 2020 will be factored into the model, the huge amount of $90.000 will emerge even if it seems ridiculously high now. It will prove that halving effect is not priced properly at the moment and the price of around USD 8,000 will start growing after the New Year.
Agree or not, Bitcoin Will Leap
Not anyone accepts the forecast, according to which Bitcoin will leap to $90.000. For example, gold bug Peter Schiff started bashing BTC when it dropped to $7,990 in a couple of hours. The crtic says that this drop of $1,800 in a couple of hours is just a start. He also adds in one of his interviews that the support line of the large descending triangle was broken by Bitcoin. Though BTC was carving it out for months, it happened. It proves that the risk of rapid down to $4,000 or lower still exists.