Bitcoin could reach $30,000 by the end of 2020
Bitcoin is looking increasingly strong and optimistic as we approach the halving in May and the famed stock-to-flow model predicts new all-time highs by the end of the year
Bitcoin reached 7K on the 16th April and managed to hold this price level over the weekend, possibly building on this as a new support level for the past four days. Bullish analysts are hoping that the cryptocurrency is gearing up for another rise, possibly to around the $9,000 mark. There has been a number of bullish developments for Bitcoin in the last few days, but investors should be wary of betting the farm just yet in case of another shakeout — selloffs have occurred after previous halving events.
A fly in the oil-ment
Some bullish news for Bitcoin is the fall in oil prices to levels not seen since the 1990s. The slump in demand for the fossil fuel is linked with the continued lockdown and decreased economic activity. Despite the rock-bottom prices, Saudi Arabia has signalled it will resume production of oil, potentially further decreasing its price with added surplus and a stagnant demand.
Why is this good news for Bitcoin? It removes another commodity and avenue of investment for those looking to store their money somewhere amid the crisis.
One could argue that oil’s current state is the perfect time to invest, but with more uncertainty on the horizon, and talk of a vaccine taking up to another year, the looming recession may bring oil crashing back down from any gains it makes in the short term future. Bitcoin, on the other hand, is not tied to the wider economy in the same way as oil, so uncertainty for oil prices is good news for BTC prices.
Stock to flow model predicts $30,000 BTC by the end of 2020
The highly regarded stock-to-flow model will be put under its first true test in the halving, according to creator PlanB.
IMO #bitcoin 2020 halving will be like 2012 & 2016. As per S2F model I expect 10x price (order of magnitude, not precise) 1-2 yrs after the halving. Halving will be make-or-break for S2F model. I hope this halving will teach us more about underlying fundamentals & network effects pic.twitter.com/kiTdN0n3Lu
— PlanB (@100trillionUSD) April 16, 2020
If it stands the test, then it could potentially predict new all-time-highs in the cryptocurrency space above and beyond those seen in December 2017.
As mentioned above, another shakeout is likely to come at some point following the halving, so some buyers will be looking to snap up cheap Bitcoin before the asset potentially moons towards the end of the year.