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What is key to Bitcoin hitting $300K in a year?

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Bitcoin’s market has been performing exceptionally lately, with the cryptocurrency recording YTD returns of 160%, at press time. It should be noted, however, that even though the gains in the present market are more “real,” compared to 2017, the inclination from institutions in the market has mainly been driven by the high volatility in the digital asset market.

According to data provider Skew, despite the high volatility, the close to close Realized Volatility of Bitcoin is half of what it was in 2017. In fact, it has moved less than 2% close to close in absolute value 207 days this year, making it less volatile than most technology stocks or commodities in the traditional market.

However, since Bitcoin has not yet surpassed its previous ATH, the cryptocurrency, in a way, is still in unchartered territory. Ergo, there could be a regime change if Bitcoin moves above $20K, especially in light of the record cheapness of Options skew.

Bitcoin and digital gold

The said volatility and price have definitely invited more institutions to invest in Bitcoin, but will this interest sustain itself above the $20K price level? This depends on how much of the ‘Bitcoin is digital gold’ narrative follows through.

Consider this – Recent entrant and prominent investor Stanley Druckenmiller noted that Bitcoin could be an asset class that has a lot of attraction as a store of value. This view definitely points to a shift in the thought process of big-time investors. In fact, while he conceded that he owned more Gold than Bitcoin, he added,

“I own many, many more times gold than I own bitcoin, but frankly if the gold bet works, the bitcoin bet will probably work better because it’s thinner and more illiquid and has a lot more beta to it.”

While the use of Bitcoin has remained limited to crypto-specific operations, most investors have not put their trust in it like they have in Gold. Thus, the possibility of Bitcoin’s price climbing to $300K by the end of 2021 (As assessed by Citigroup) will remain a far-fetched dream for now. This is simply because the narrative of ‘Bitcoin is digital gold’ has not been realized yet and it has not found its place among institutional investors.

That’s not all, however, as Ray Dalio believes that he cannot imagine Bitcoin being used by central banks, big institutional investors, businesses, or multinational companies, like they are using Gold. This highlighted the belief in Bitcoin being used as a hedge again inflation trades, while also underlining Gold’s precedence in comparison.

To grow as big as the Gold market, Bitcoin’s market cap has to reach $9T, which would mean a price of $485k per Bitcoin. This is higher than the estimated price put up by Citigroup. However, the only way this can be possible is if it attains the status of digital gold and if the investors believe that digital gold is indeed equivalent to physical gold.

Looking at the crypto-market right now, it is difficult to see Bitcoin climbing to $300K by the end of 2021.

Source: https://eng.ambcrypto.com/key-to-bitcoin-300k

Blockchain

Bitcoin: Temporary Correction or No ATH This Year? The Crypto Weekly Market Update

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Bitcoin has a way of surprising people. This week was no exception. A few days ago, almost everyone believed that the cryptocurrency is inevitably headed to a new all-time high. And how could they not? BTC was trading at a few hundred USD below the record from back in 2017. Unfortunately, things took a turn for the worst.

Yesterday was undoubtedly a bad day for bitcoin as it plunged a total of around $3,000 in less than 24 hours. From a high of about $19,500 down to $16,200, the bears poked and showed their faces. The entire market lost around $80 billion of its capitalization as altcoins actually had it worst.

During the market dive, Bitcoin’s dominance actually increased, showing that not only altcoins failed to hold their ground, but they dropped harder than BTC. Since then, there has been a slight recovery and at the time of this writing, the primary cryptocurrency is trading at around $17,000.

The move was seemingly propelled by the news that US regulators might seek to require identity verification from crypto wallet providers. Coinbase’s CEO, Brian Armstrong, commented on the matter, expressing his worries that if the new rules are implemented, they would be rather harmful to the users and the industry, in general.

At the same time, the popular cryptocurrency exchange OKEx opened withdrawals for the first time since they were shut down around a month ago, which might have prompted users to cash out the profits that they have been sitting on. In fact, CryptoPotato reported that around $500 million were withdrawn from the exchange as the crash started to take place.

In any case, the results are here, and it remains particularly interesting to see where will bitcoin go from here.

Market Data

Market Cap: $512B | 24H Vol: 181B | BTC Dominance: 62%

BTC: $17,132 (-7.98%) | ETH: $516.86 (+1.71%) | XRP: $0.56 (+74.08%)

Bitcoin Worth $500 Million Withdrawn From OKEx as Users Look for Other Alternative. Data shows that users withdrew a total of 29,300 BTC from the popular cryptocurrency exchange OKEx right after it resumed full functionality. This happened just as bitcoin plunged $3,000 in a matter of 24 hours. The exchange also resumed the withdrawals a day earlier than announced and during the Chinese trading hours.

Bitcoin Black Friday 2020: The Sales You Better Not Miss. It’s the end of November, and with this comes the long-anticipated shopping season. For many, this is a time to enjoy massive sales. We’ve taken the liberty of listing a few sales within the cryptocurrency field that aficionados might find interesting.

Facebook’s Libra Could Reportedly Arrive in January 2021 in a Scaled-Down Version. Libra, Facebook’s long-awaited cryptocurrency project, might be set to launch in early 2021. However, the version that’s potentially hitting the market is scaled-down and specifically intended to abide by the regulations of Switzerland’s FINMA.

Research Suggests Satoshi Nakamoto Launched Bitcoin From London. New research shows that activities associated with Satoshi Nakamoto from 2008 and 2010 might have taken place in London when Bitcoin’s network went live. This brings the experts a step closer to identifying who’s behind the legendary pseudonym.

6 Possible Reasons For Bitcoin’s $3,000 Daily Price Crash. Bitcoin went through a massive crash two days ago when it lost around $3,000 of its value in a sudden red candle. These are six reasons for which this may have happened and a brief outline of what might be next to come.

Coinbase CEO Fears Rumored Regulations Proposed By The Trump Administration. Brian Armstrong, the CEO of the leading US-based cryptocurrency exchange Coinabse, has said that he’s worried about the rumored regulations concerning third-party wallet providers having to identify their users. He said that this might harm users and the entire ecosystem.

Charts

This week we have a chart analysis of Bitcoin, Ethereum, Ripple, Chainlink, and Stellar Lumens – click here for the full price analysis.

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.

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Source: https://cryptopotato.com/bitcoin-temporary-correction-or-no-ath-this-year-the-crypto-weekly-market-update/

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Blockchain

Ripple Plans To Cash Out 33% Of Its MoneyGram Stake With A Significant Profit

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  • The San Francisco-based payment protocol has filed a document on Friday with the US Securities and Exchange Commission (SEC). It reads that Ripple Labs has entered into an agreement with MoneyGram, which entitles Ripple to sell up to 4,000,000 shares of common stock.
  • Ripple’s option to sell these shares will expire “upon the earliest of March 31st, 2021, the time at which the maximum amount shall have been sold, or the occurrence of certain other customary events affecting the issuer.” 
  • CryptoPotato reported last year that Ripple and MoneyGram announced a strategic partnership. The initial term of the agreement was for two years. Ripple had agreed to provide a capital commitment amounting to $50 million in exchange for equity through the two-year period.
  • As per the SEC filing, Ripple owns 6.22 million shares of the giant money transfer company (or 8.6% of shares outstanding). However, the blockchain company has a warrant to buy up to another 5.95 million shares, amounting to a total equity position of 12.2 million shares or 17% of MoneyGram’s shares outstanding).
  • With the initial investment in 2019, Ripple purchased the MoneyGram shares at 4.10 per stock, which was a significant premium to the market price. 
  • Nevertheless, MoneyGram’s stocks (MGI) have surged in 2020, closing Friday’s session at $7.42. As such, Ripple can cash out with an 80% profit, despite the initial premium.
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Source: https://cryptopotato.com/ripple-plans-to-cash-out-33-of-its-moneygram-stake-with-a-significant-profit/

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Blockchain

South Korea To Postpone Previously Planned Crypto Income Tax

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Lawmakers in Korea are planning to postpone a recently considered tax on crypto assets profits. Reports say the tax rule delay will be about three months – instead of October 2021, January 2022.

The New Crypto Income Tax Rule To Wait Until January 2022

According to a recent media report, the South Korean congress plans to put off the recently considered cryptocurrency income tax rule. A planning and finance committee of the National Assembly has issued a report, which proposes the necessity of implementing the crypto income tax rule from at least 2022.

A few months ago, in July, a report stated that South Korea’s Minister of Finance and Economy believes that the country should come up with a tax on cryptocurrency trading and investing. Back then, he added that South Korea has been in discussion with other countries about introducing a new digital law.

In July 2020, the country’s Ministry of Economy and Finance amended its tax code, where it included the plan for charging residents a 20% tax on gains from cryptocurrency trading, which are worth more than 2.5 million Korean won (about $2,000).

Lawmakers in the National Assembly are to approve the Government’s plan, which was to carry into effect the cryptocurrency income tax rule from October 2021.

Reason For The Delay – Time Is Tight

As per the media report, the reason for the postponement of the crypto tax law is based on some concerns, raised by local crypto exchanges. They have claimed the lack of time to build their proper tax reporting system and infrastructure, needful for the process to begin.

The so-called “Specific Financial Information Act” would be enforced from March next year, so crypto exchanges have to complete the necessary reporting system by September 2021 for verifying their real names of deposit withdrawal accounts.

As CryptoPotato reported, South Korea announced the planning of the crypto income tax in June this year. The Asian country went through some different views on how and whether it should tax profits from cryptocurrency. Firstly, at the beginning of 2020, the Ministry of Economy and Finance did not consider that digital asset trading gains as taxable income. A month later, another local report said the Ministry believes that the nation could start label cryptocurrency trading profits as “other income.”

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Source: https://cryptopotato.com/south-korea-to-postpone-previously-planned-crypto-income-tax/

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