Bitcoin began to flirt with the $10,000 mark yesterday. This was a kickstart to the speculation of it breaking the five number barrier. After the record-breaking month it has had so far, not many are surprised. One more psychological barrier breaks to hit $10,009 for a brief moment this morning. At the time of writing, it went down to $9945.18, but speculation is rampant- how much higher will it go?
Michael Novogratz is one of the few hedge fund managers to predict that bitcoin would reach $10,000. He is now predicting that we could see a height of $40,000 reached by the end of 2018. He cites the strengthening of the cryptocurrency as due to the lack of supply response. Commodities such as oil can meet demand production. However, bitcoin has a supply limit of only 21 million. He has also named bitcoin a “speculator’s dream”.
The question now is when will the bubble pop? Could the rising demand be the demise of bitcoin? It has mysterious origins. It’s also not government regulated nor legal tender. This has led many investors to hold back. But now it is becoming more commonplace. For example, in Japan, the trading in bitcoin is dominating at approximately 62%. And, the price continues to rocket higher. So, more and more investors are jumping onboard. Financial advisors are providing contrasting advice. Novogratz of Fortress Investment advises retail investors to put 1 to 3 percent into cryptocurrency. And, the CEO of JPMorgan Chase denounces anyone investing in bitcoin as “stupid.” He refuses to engage in conversation about where it’s trading now on the market.
This article is third-party analysis. It does not constitute any financial advice, which can only be provided by a certified financial adviser.