CRYPTOCURRENCY FORECASTS AND TRENDS FOR 2019-2020
The rush around the cryptocurrency market has passed, the bubble has burst and prices have reached a logical level for the development of this industry. But interest in digital money is growing.
Against the background of last year’s boom, many believe that cryptocurrencies are dying out. In fact, they develop at a pace that was originally expected.
Indestructible, Bitcoin takes first place. Based on its indicators, the situation in the entire market is built. Therefore, first of all I want to talk about the predictions of this particular cryptocurrency.
Nevertheless, altcoins are developing every year. Some even “breathe in the back of Bitcoin”, if you follow the statements of experts. BTC and ETH are not really the only favorites. The market is constantly changing, regulation is unclear but there are some interesting projects.
As an investor, you must realize that placing money into cryptocurrency (and seeing some of the wild returns achieved in 2018) is speculative at best.
With that being said, with over a decade and a half as a professional trader- I do own cryptocurrency as part of a well balanced portfolio that includes but is not limited to: real estate, stocks, bonds, cash, gold & silver, art & collectibles (mainly football and basketball cards & memorabilia s well as a fine collection of beat up Pokemon cards thanks to my son’s obsession with them)
Before deciding to invest into cryptocurrency, put pen to paper and formulate a gameplan. Do not rush in out of FOMO (fear of missing out) like so many people did in 2018 and got absolutely crushed. The first decision to make is the amount of risk that you are comfortable with. An amount that if digital currencies disappear tomorrow- wouldn’t keep you up at night.
For most people, that would be between 5-15% of their total investment portfolio. “Portfolio” is simply a fancy word for investments that people with money like to use… OFTEN.
25% of my investments are in blockchain related projects and cryptocurrency. That is considered extremely aggressive and not recommended.
So for someone new to investing, or brand new to cryptocurrencies or Bitcoin, you do not need a fancy leather bound man satchel tucked at your side, or be a professional investor to start investing in any market, cryptocurrency included. You can start investing and begin your portfolio in less than 15 minutes.
A BALANCED PORTFOLIO
Deciding on the % of your investments are in Bitcoin/Cryptocurrency can be a daunting task. As I mentioned above, for most people that % would be between 5-15% of their total investment portfolio
Out of this 5-15%+ that you decide on, the next step is to decide how much to put into bitcoin, how much to put into altcoins that are in the Top 100 at coinmarketcap and how much to put into smaller, riskier and more speculative names outside the top 100. Personally, I use a 70/20/10 ratio.
BEGINNER CRYPTOCURRENCY INVESTING
For stocks: you can use TDAmeritrade, Schwaab, or any other wirehouse that charges low fees and maintains a solid reputation. Please do your own research and due diligence to find the best platform for you.
To purchase cryptocurrency like Bitcoin or any of the Altcoins you have several options. You can purchase through an exchange, even an app on your smartphone.
For those who will be actively trading, you’ll want to start at an exchange like Binance, or another established exchange. For everyone else, and those who just want to purchase Bitcoin, Ethereum, Bitcoin Cash and altcoins- an exchange will probably make you go crosseyed.
The easiest way to purchase cryptocurrency is through apps like Coinbase or BRD wallet. Yes there are fees involved that cost more than purchasing through an exchange, but I am simply going over the easiest ways to purchase for someone who just wants to invest or own cryptocurrency and do so in the simplest way possible.
Coinbase has an app in itunes & Google play as well as BRD wallet. I use both as well as Binance.
NEXT YOU’LL NEED A WALLET
There are a ton of different options, but for the sake of saving time and boring readers to death I use Bread (BRD) Wallet. You can download it in the iTunes App store & Google Play Store for Android users.
BRD is a non custodial mobile wallet, available both for iOS and Android. The beauty of BRD lies in its simplicity.
While many Bitcoin wallets overload users with extensive onboarding processes and a confusing interface, BRD is as simple as it gets.
HOW TO SEND A RECEIVE BITCOIN USING BREAD (BRD) WALLET
Adding bitcoin to Bread is easy, and includes some built-in options that are not available in many other wallet apps. To get started with Bread, you will first need to download the app, either for iOS or Android.
- When you launch Bread for the first time, you’ll want to choose “Create a New Wallet”.
- You’ll be prompted to choose a 6-digit pin code to use for logging into your new wallet.
- Once you’ve entered your code, Bread will generate a master “seed phrase” for you, also called a “paper key”. This phrase, which is a series of 12 random words, will allow you to recover your wallet if your phone is ever lost or stolen. It’s recommended that you write down these words (on paper, hence “paper key”) and keep them in a safe place.
- Bread may ask you to enter in a few of the words to verify that you have written down the seed phrase.
- Once you’ve chosen a personal identification number (PIN) code and written down your paper key, your new wallet is ready to use. To add bitcoin to your wallet, you have some options. If you already have bitcoin, you can transfer it into Bread by tapping “Receive”.
- In the “Receive” panel, you can see your wallet address, QR code, and a link to easily share this information via email or text message. Simply send your bitcoin to your new address by using one of these methods.
- If you don’t already have some bitcoin, the option to buy bitcoin directly through Bread can be found by navigating to “Menu”.
- To buy bitcoin in cash, Bread offers a convenient mapping feature that allows you to find bitcoin ATMs and retailers in your area.
- To buy bitcoin using your bank account, the Bread app partners with a third-party service, which has its own set of “Terms and Conditions” that users may want to consider before using this feature.
HOW DO I MAKE PAYMENTS WITH BREAD?
Once you’ve added some bitcoin to Bread, making payments is straightforward. Because Bread connects directly to the bitcoin network, rather than processing transactions through the company’s servers, transaction speeds may vary depending on network activity.
- To send a payment in bitcoin, simply navigate to the “Send” option from Bread’s home screen.
- To enter the receiving address, you have the option to paste it in if you’ve copied it from somewhere else, or to scan a QR code using your phone’s camera.
- Once you’ve entered the wallet address of the payee, type in the amount to be sent.
- You can navigate between viewing the amount in bitcoin and fiat currency, for easy conversion.
NOW THAT YOU HAVE BITCOIN IN YOUR WALLET
Now that your Bitcoin is safely stored in your wallet, you can hold onto your investment in hopes that the price of Bitcoin rises, use it to purchase other cryptocurrencies, send to an exchange, use as payment and even bet on sports or play casino games (although we don’t recommend it.)
THE CRYPTOCURRENCY MARKET
Before we get in to forecasts and predictions (which are simply estimates at best) let’s take a look at the current market and some of the fundamentals driving the price of Bitcoin & altcoins.
The cryptocurrency market is mixed red and green. Bitcoin is struggling to correct the negative retracement on the day after sliding 0.54%. Ethereum and Ripple are slightly bullish posting minor gains on the day. The selected cryptoasset leading the recovery on Tuesday is Litecoin which is up 2%.
The long-awaited ICE-backed exchange Bakkt has opened its custody service, Bakkt Warehouse in readiness for Bitcoin futures. The announcement made on Monday via Twitter said that “Bitcoin deposited at our Warehouse is protected by a $125 million insurance policy.” The exchange is set go live with physically settled Bitcoin futures on September 23.
Bitcoin is hovering above $10,000 at the time of writing but the CEO of ShapeShift, a crypto startup exchange sees the largest crypto by market capitalization hitting $20,000 by the end of 2019.
BITCOIN PRICE PREDICTIONS BY CRYPTO EXPERTS
Michael Novogratz: $20,000 or more
Michael Novogratz, CEO of investment firm Galaxy Digital, expects Bitcoin to finish 2018 somewhere between $8,800 and $9,000 and sees BTC break $10K ‘by the end of the first quarter of 2019’. “And after that, we will go back to new highs — to $20,000 or more”, Novogratz told Financial Times in an interview in November 2018.
The main reason for the price spike in 2019 will be the entrance of more institutional investors in the space, Novogratz thinks. “There’s going to be a case of institutional FOMO, just like there was in retail”, the investor said.
Sonny Singh: $20,000 by the end of 2019
Sonny Singh, Chief Commercial Officer of Bitpay, a Bitcoin payment processing company, agrees with Novogratz that $20,000 is a reasonable price target for Bitcoin by the end of 2019. Singh predicts that Bitcoin climbs to $20K and will never drop below $15,000 anymore after that.
He thinks the new bull run will be driven by the launch of products by institutional companies such as Fidelity, Bakkt, Square and BlackRock. Singh said in an interview with Bloomberg in November 2018: “Next year will see new players and miners emerge in the industry. We will not see any rapid shift but by the end of Q1 or Q2, Bitcoin will emerge as a viable commodity.”
Anthony Pompliano: Bear market until Q3 2019
Anthony Pompliano, founder of Morgan Creek Digital Assets, first predicted Bitcoin to hit $50,000 by the end of 2018, but had to admit that his prediction was wrong. Pomp thinks we might see Bitcoin drop to $3000 first, and says it might take until Q3 of 2019 before we see a positive trend again in the market.
In a blog post, Pompliano states: ‘Bear markets continue to last longer — each bear market is measured from peak to trough during a prolonged drawdown period. The first bear market lasted ~160 days (2011) and the second bear market lasted ~400 days (2013-2014). The current bear market, if it follows the historical trend, is likely to continue for 650 days. If this comes to fruition, the crypto markets won’t begin recovering from the recent negative price movements until Q3 of 2019.’
Fundstrat’s Sam Doctor and Tom Lee: $36,000
In 2018, the analysts of Fundstrat predicted Bitcoin to reach $36,000 by the end of 2019 based on the growth of the mining infrastructure. Sam Doctor, Quant Stategist at Fundstrat, said that based on expected computing hashpower and breakeven cost growth of miners, Bitcoin could hit 36K by the end of 2019, with an upper end of $64K and a lower end of $20K.
The prediction was retweeted by CEO Tom Lee, who himself is bullish on Bitcoin on the short term as well. Lee said in November that Bitcoin will be worth $15K by the end of the year 2018, cutting it down from $25,000.
John McAfee: $170,000
Most of you know of the (in)famous Bitcoin price prediction of John McAfee, who said he will eat his dick on national television if BTC not hits $1 million by the end of 2020. Now, McAfee didn’t give a price target for 2019 (yet), but based on his 2020 prediction Bitcoin needs to be worth just over $170,000 on December 31, 2019, to be on track to hit the $1 million mark a year later.
Ronnie Moas: $28,000
Cryptocurrency analyst Ronnie Moas has predicted that Bitcoin will reach $28,000 in 2019. According to Moas, ‘institutions & the top 1% are buying as they did in the 2008 stock market crash’. In September 2018, he warned smaller investors that ‘you caught the move from $600 to $6,000… You will miss the move from $6000 to $60,000’.
Moas added that it is ‘sad to watch the top 1% scare the crap out of you, separating you from your BTC and keeping the gap between the rich and the poor’. He expects the price of BTC to rise in 2019 because of the increasing demand for and the decreasing supply of Bitcoin.
Vinny Lingham: $20K bet on BTC NOT hitting $28,000
CEO of CivicKey Vinny Lingham doesn’t agree with that price prediction of Moas. During a conference in Las Vegas in November 2018, the two experts placed a $20,000 bet on the price of Bitcoin in 2019. Where Moas predicts BTC will be worth $28K by the end of 2019, Lingham thinks the price won’t hit that mark.
Lingham stated that businesses dealing with cryptocurrencies are not making any profits and ‘need to trade their assets for sustainability purposes’. For the long term, however, Lingham is far more optimistic.
Fran Strajnar: $200,000
Fran Strajnar, CEO of crypto research firm Brave New Coin, expects the price of Bitcoin to hit $200,000 no later than January 1, 2020. In an interview with Inverse in 2018, Strajnar stated that “the adoption rates are continuing to be quite steady, and adoption rates heavily correlate to the price, so therefore, unless for some reason people just simply stop continuing to adopt Bitcoin, we should see $200,000 per Bitcoin by 1st January 2020 at the latest.”
ETHEREUM FORECASTS FROM CRYPTO EXPERTS
Joseph Raczynski: Ethereum will hit $1,200 by Q4 2019
Joseph Raczynski, the founder of JoeTechnologist.com and a key blockchain influencer with a Twitter following of 153K, expects the value of Ethereum to hit $1,200 by Q4 2019. He attributed his projection to the popularity of Ethereum’s proof of concept among institutional investors. He also added that the network has the largest developer community.
‘They are one of the most real projects to date. Nearly all large organizations are testing on this platform’, Raczynski said.
Tom Lee: $1900 by the end of 2019
According to Tom Lee, head of research at Fundstrat Global Advisors, Ethereum is about to rally strong, pointing at its recent sharp losses, and stating that the digital currency is well-positioned for a recovery.
While Lee may be highly bullish on Ethereum’s price prediction, Tim Enneking, managing director of Digital Capital Management, disagrees.
He said that such a price move is highly unlikely. ‘There are no drivers to push ETH to 40% above its prior all-time high’, he added.
Nigel Green: $2500 with a further increase in 2019 and 2020
The CEO of the deVere Group, believes the price of Ethereum will increase significantly and could hit $2,500 with a further increase by 2019 and 2020.
‘This general upswing will be fueled by three mains drivers. First, more and more platforms are using Ethereum as a means of trading. Second, the increased use of smart contracts by Ethereum. And third, the decentralization of cloud computing’, DeVere said.
According to DeVere there will be several key motivators that will fuel a rally in crypto prices, which will include the growing integration with and adoption by major banks and other financial institutions.
‘Another key reason for the rally is that there’s a growing awareness of the need and demand for digital, global currencies in a digitalised, globalised world’, Green said. ‘Ethereum can be expected to solidify its position as the second most valuable and used cryptocurrency token in the world.’
Brian Schuster: $10,000 or even $100,000, if it replaces gold as a store of value.
The head of Founder Solutions at Ark Capital LLC presents an extreme bullish picture of Ethereum reaching $100,000 per coin. The ultimate replacement of gold with crypto has been discussed endlessly by a number of other market observers, even though Bitcoin is mostly seen as the favourite replacement coin.
‘What if you believe that Ethereum is less like one individual business and more like a store of value, like gold? This gives us a potential market capitalization of roughly $10 trillion, leading us to believe that the price of Ethereum might rise as high as $100,000 per coin. We might even go one step further and say that Ethereum is not like one asset, but an asset to replace all currency that exists.’, Schuster said.
Schuster further claims that Ethereum’s platform aspect may eventually lead to it becoming a sort of mother currency for all future digital currencies, and this in a world where digital currencies are the norm.
Jeff Reed: Ethereum is more valuable than Bitcoin
Cryptocurrency author and market observer Jeff Reed points out Ethereum as a more certain long-term bet than Bitcoin.
‘Like Bitcoin, there is little stopping Ethereum from being an alternative currency to fiat and commodity currencies. You can conceivably trade anything using Ethereum, but this is not Ethereum’s strength in comparison to other cryptocurrencies – they can all do this. It’s rather the computing language that allows the smart contracts to exist that makes Ethereum more valuable than BTC’, he said.
Reed doesn’t give a price prediction or timeline, however, according to him, the market boils down to Ethereum eventually trumping Bitcoin, and seizing its top price position.
Chris McClure: Ethereum is overdue for a rally going into 2019
Chris McClure, chief marketing officer of cryptocurrency at data provider Svandis, said that they believe heavily in Ethereum.
‘Whether it’s Sharding, Plasma, or OpenST Mosaic, there are tremendous technological reasons to be bullish on Ethereum and to believe in a speculatively high price moving in 2019.’
‘Ethereum is aggressively oversold and overdue for a rally going into 2019’, McClure said.
Fred Wilson: Ethereum feels like the easiest one to make a bull case for right now.
Fred Wilson, the co-founder of Union Square Ventures, one of the most well-known venture capitalist firms in New York City that manages over a billion dollars in assets, said that Ethereum feels like the easiest one to make a bull case for right now.
‘Everyone has lost their shirt on it by now. Nobody other than developers want to know about it. It feels like time to start nibbling on it but not loading up on it.
THE BOTTOM LINE
At best, these are just guesses… no one knows what the price of Bitcoin Ethereum will actually be at the end of 2019-2020. I believe Bitcoin could easily break 27,000 before the end of 2020 and have not placed a forecast on Ethereum as there are too many variables at play.
Again, do not take any of this as investment advice or a recommendation to buy or to sell. Use this and additional research that you conduct on your own to formulate your own opinion. One thing I can promise is that your guess is as good as ours.
CBOE files to list Van Eck’s proposed Bitcoin ETF
Globally leading exchange holding company, Chicago Board Options Exchange, or CBOE, has filed to list the Bitcoin exchange-traded fund proposed by asset manager, Van Eck.
CBOE filed a Form 19b-4 requesting permission to list the ETF from the U.S. Securities and Exchange Commission on Jan. 3. In the form, CBOE emphasizes the benefits an ETF would offer to retail investors over the spot Bitcoin markets, including custody:
“Exposure to bitcoin through an ETP also presents certain advantages for retail investors compared to buying spot bitcoin directly. The most notable advantage is the use of the Custodian to custody the Trust’s bitcoin assets.”
While CBOE did not reveal who its custodian is, the document notes its custodian is “a trust company chartered and regulated by [the New York Department of Financial Services].”
Once the SEC has formally acknowledged it is reviewing the application, the regulator has 45 days to deliver its verdict or extend the assessment deadline. The SEC can extend its deliberation period for up to 240 days before finalizing its decision.
If approved, the ETF would be the first crypto product offered by CBOE since February 2019, with CBOE having then ceased offering Bitcoin futures contracts. In December 2017, CBOE became the first regulated financial institution in the United States to offer Bitcoin futures contracts, beating out the Chicago Mercantile Exchange by just a couple of weeks.
In January, Van Eck filed for SEC approval of a Bitcoin ETF. While Van Eck had previously filed for a BItcoin ETF in 2017, the firm also teamed up with SolidX — a blockchain firm that had been attempting to bring a Bitcoin ETF to market since 2015 — to file for a jointly issued ETF in 2018. The joint application was withdrawn in September 2019, with the two firms parting ways shortly after.
However, Van Eck’s latest filing has become the subject of a lawsuit from SolidX, who alleges Van Eck plagiarized their product.
Van Eck also filed for an ETF tracking the performance of prominent crypto firms on Jan. 21. The product would seek the price and performance of the Global Digital Asset Equity Index — which is run by its subsidiary MV Index Solutions.
As of this writing, the SEC is yet to approve any crypto ETF product.
Coinbase custodies 11% of entire crypto capitalization
Crypto data aggregator Messari has reported that the quantity of crypto assets stored in custody on U.S. exchange giant Coinbase surged in the last quarter of 2020.
Messari Crypto has revealed that as much as 11% of the entire crypto market capitalization was held with Coinbase custody at the end of last year. The Coinbase offers custody services for over 90 crypto assets, roughly half of which are tradable on Coinbase’s exchange.
The value of assets custodied with Coinbase spiked to roughly $90 billion in the fourth quarter of 2020 as the combined crypto capitalization more than doubled to tag $780 billion by 2021.
— Messari (@MessariCrypto) March 1, 2021
Despite the wide variety of assets supported by Coinbase Custody, Messari found that Bitcoin and Ethereum account for 83% of the cryptocurrency held with Coinbase.
While Bitcoin consistently represented 70% of the assets custodied with Coinbase during 2019 and 2020, Ethereum increased from 9% to 13% over the same period.
The findings were published in a report examining Coinbase’s anticipated public listing that was compiled by Messari researcher Mira Christanto.
Christanto reported that 95% of Coinbase trading revenues are from retail clients, who pay 30 times more than institutional customers. She also noted a pre-IPO valuation at 7% of the total crypto market cap which would equate to around $107 billion according to the sector’s current market cap of $1.54 trillion.
According to the S-1 report Coinbase submitted to the Securities and Exchange Commission on Feb. 25, the exchange posted a direct revenue of $1.1 billion in 2020 mostly from trading fees.
In a Feb. 25 blog post to its clients, Coinbase revealed that Bitcoin and other crypto assets have comprised a major share of its corporate treasury since the company’s founding back in 2012.
Leverage traders ‘flushed out’ by late-February crypto crash: Glassnode
According to on-chain analytics provider, Glassnode, the late-February crypto market correction may have purged excessive leverage from the markets.
Glassnodenoted the crash peaked with a 25% fall from the local top of $58,300 to $43,343. As such, the move was weaker than January’s dip which saw a roughly 30% retracement from $42,000 to less than $30,000.
The analytics provider suggested that these pullbacks are positive for the crypto markets overall, attributing the latest correction to liquidated leveraged positions held by risky speculators:
“Significant market corrections are positive events in that they flush out speculation, leverage, weak hands, and test holder conviction.”
The report added that several key market indicators were reset as BTC prices found fresh support, including futures open interest, futures funding rates, and the price premium for Grayscale’s investment products.
Futures open interest, which is the total number of outstanding contracts that have not been settled, dropped almost $4 billion or 22% from its peak of $18.4 billion. Glassnode also commented noted perpetual futures funding rates have also reset close to zero, which could indicate that traders are not willing to enter short positions, stating:
“Previous combinations of decreasing open interest and a reset of funding rates have indicated a flush in speculative trading has occurred.”
However, the report did note that open interest is still hovering roughly $2.5 billion above the previous peak of $3.9 billion on Feb. 21 — meaning there is still significant leverage within the market.
Glassnode also noted that shares in Grayscale’s Bitcoin Trust are trading at a discount compared to spot market prices for the first time ever, with investors paying a nearly 4% discount to access exposure to BTC through Grayscale’s trust.
It added that competing products such as Canada’s Purpose ETF could diminish Grayscale’s premium as more institutional products enter the market and close arbitrage opportunities.
At the time of writing, Bitcoin prices were up 5.3% over the past 24 hours, with BTC currently changing hands for $49,200.
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