Bitcoin (BTC) Ending 2019 Under $40,000 Would Be an “Anomaly”: Why?

Over the past four days, Bitcoin (BTC) has been through it all. After rallying to surpass $13,000 for the second time this year, the cryptocurrency paused, took a breath, then decisively lost steam as bulls failed to maintain momentum.

As of the time of writing this, BTC sits at $11,300, down almost 13% in the past 24 hours. Altcoins are doing worse, with Ethereum, XRP, Litecoin, and other large-cap crypto assets slipping by more than 15%.

Related Reading: Bitcoin Hashrate Grows at Fastest Rate Ever; Will BTCs Price Follow?

Despite this rapid decline, which effectively confirms that BTC isn’t ready for new year-to-date highs just yet, some analysts are still bullish. In fact, one new model suggests that Bitcoin will rally by at least another 200% this year, no holds barred.

Bitcoin to Hit $50,000 in 2019?

Timothy Peterson, a Texas-based crypto fund manager and Bitcoin pioneer, recently laid out the model below which plots how BTC’s performance in the first half of any given year relates to the second half’s performance.

Interestingly, the model, which can be defined as the positive slope y = 1.1409x + 0.5151, fits the trend to 90%, implying that it should be fairly accurate. Alright, so now that we have established the model, what does it predict.

Well, according to Peterson, Bitcoin gaining 180% year-to-date (effectively the 2019’s first half) implies that it has another 250% (“give or take”) left to run by the end of the year.

A 250% gain from current levels would mean Bitcoin ends the year at $40,000 practically double BTC’s 2017 all-time high of just around $20,000. According to Peterson, even $50,000 is realistic.

Considering that BTC just plunged by nearly $2,000, this may seem somewhat unrealistic, and maybe even impossible-sounding. But, there is another model that indicates that BTC does have lots of room to run, even in 2019.

Does This Prediction Hold Its Water?

As you are likely aware of, May 2020 will see the next Bitcoin block reward reduction, during which the amount of BTC put into circulation around every 10 minutes is cut in half.

While this may not sound notable, a model from analyst PlanB, also known as 100 Trillion Dollars, suggests that the so-called “halving” event will be a massive boon for the value of BTC. A boon that may give it the potential to move past $20,000 and beyond.

As reported by NewsBTC previously, PlanB uses what is called the stock-to-flow (SF) ratio to back his target. For those unaware, the “stock” is the amount of said asset, usually a commodity, in circulation; the “flow” is basically the inflation rate, or how much of the commodity was added to the total stock in a year.

Right now, Bitcoin sports an SF ratio of 25, implying an inflation rate of 4% per annum. Gold has an SF ratio of just above 50, coming in at around 55. PlanB postulates that there is a correlation between the market capitalization of a scarce asset and its SF ratio.

Related Reading: Analyst: Bitcoin May Consolidate for Several Months, But Six-Figure Price Surge is Still Imminent

With the halving, Bitcoin’s SF ratio will reach 50, meaning that it will near that of gold. If we follow the line of best fit for the model, it predicts that by May 2020, the “fair” stock to flow value for BTC will be around $55,000 per coin.

While May 2020 is obviously not the end of 2019, some analysts expect for investors to “front run” this key event, which is something that should result in Bitcoin price appreciation towards $55,000.

This isn’t the only model or indicator signaling that Bitcoin could soon hit $40,000. Per a recent CNBC interview with Fundstrat’s Tom Lee, Bitcoin will soon see fresh all-time highs. In that interview, Lee didn’t tip his hand as to why comes after “new all-time highs”, but speaking to Binance’s CFO, he did.

He stated that once $10,000 is breached, FOMO will result in a “fast and furious” move to $20,000, then a six-month appreciation to potentially $40,000.

Featured Image from Shutterstock

The post Bitcoin (BTC) Ending 2019 Under $40,000 Would Be an “Anomaly”: Why? appeared first on NewsBTC.

11.07.2019 / 04:40 47
Bitcoin Hashrate Grows at Fastest Rate Ever; Will BTC’s Price Follow? Bitcoin Hashrate Grows at Fastest Rate
Bitcoin has once again incurred a massive amount of volatility that has made it increasingly unclear as to where BTC and the aggregated crypto
Bitcoin Smashes Past $13,000: What Fundstrat Says is Behind BTC’s Strength Bitcoin Smashes Past $13,000: What
Last week, Bitcoin was nursing a heavy hangover, which took hold of the cryptocurrency market after BTC hit and failed to break through $13,800. BTC
Analysts Expect Ethereum to Follow Litecoin’s Lead and Skyrocket in Near Future, Here’s Why Analysts Expect Ethereum to Follow
The aggregated crypto markets have been facing an influx of bullish momentum over the past several months that is showing few signs of slowing down
Ethereum (ETH) May Pull Back Over Next Two Weeks, BitMEX Data Hints Ethereum (ETH) May Pull Back Over Next
Ethereum May Soon Consolidate It isn’t a secret that the cryptocurrency market has been on a tear. Bitcoin (BTC), Ethereum (ETH), and many other
Last 48 Hours See Biggest Altcoin Rally In 9 Months But Bitcoin Still Ahead Last 48 Hours See Biggest Altcoin Rally
Altcoins have been staging a significant rallyagainst Bitcoin in the past couple of days. However, Bitcoin’s own gains in May mean they may have
Bitcoin Sets Yearly Low Below $4,400, Recovers Slightly as Altcoins Continue to Drop Bitcoin Sets Yearly Low Below $4,400,
After yesterdays widespread market carnage, Bitcoin has continued to drop and is showing little sign of a pending recovery. Bitcoins latest drop to
Comments (0)
Add a comment
Comment on