Bitcoin bulls have had a good year so far. If the US defaults on its debt, it could get better, at least in terms of its investment in bitcoin.
This is according to Jeff Kendrick, Head of Digital Asset Research at Standard Chartered. he he said from the inside This week, a US default — which he called a “low-probability, high-impact event” — could cause Bitcoin to jump nearly $20,000, up nearly 70% from current levels.
Bitcoin started the year below $17,000 but is now hovering near $30,000. That’s still far from the all-time high of nearly $69,000 in November 2021, and some investors who were buying bitcoin at the time are still licking their wounds.
Kendrick predicted that bitcoin would do well even if cryptocurrencies in general, which trade like stocks, don’t. “So in fact, the optimal trade would probably be long Bitcoin, short Ethereum. That kind of combination would probably be a good expression of that,” Kendrick told Insider.
Monday, Kendrick said in a note Bitcoin could reach $100,000 by the end of 2024 and the “crypto winter” is over. He added that Bitcoin has benefited from its status as a “branded safe haven, relative store of value and a means of transfer.”
The price of bitcoin soared earlier this year after the collapse of a Silicon Valley bank and mounting fears of a banking crisis.
Meanwhile, the debt ceiling crisis intensified. On Wednesday, House Republicans passed legislation (barely) that would raise the government’s debt ceiling in exchange for spending restrictions. In the coming weeks, they will try to reach a compromise with President Joe Biden that would allow the country’s debt to be raised.
If the United States defaults on its debt this summer, the consequences will be dire for America and the world. Last month, Treasury Secretary Janet Yellen warned lawmakers that “defaulting on our debt will lead to economic and financial disaster.”
Few think they will come to that.
But even without a US default, many bitcoin bulls see good things ahead. In five years, ARK Invest CEO Cathy Wood said in February that in five years bitcoin will be worth “nearly $670,000, something like that, and then by 2030 we see more use cases and more insurance policies.” These that have been taken against financial systems and policies that are not “healthy, we think could exceed a million dollars.”
Bitcoin has a lot of critics and skeptics, of course. Mark Mobius, billionaire co-founder of Mobius Capital Partners, predicted in December that the bitcoin price would drop to $10,000 sometime this year. He has He said about bitcoinIt’s not an investment, it’s a debt.
Earlier this month, Berkshire Hathaway CEO Warren Buffett reiterated his longstanding skepticism. “Something like Bitcoin, it’s a gambling token, and it has no intrinsic value,” he told CNBC. squawk box. “But that doesn’t stop people from wanting to play the roulette wheel.”