Bitcoin Price Soaring, What’s Next?
Cryptocurrencies, such as Bitcoin, are surging. In the last one year, the digital currency has increased close to 1,400% in value. One bitcoin is now worth around $12,000.
As the price of the cryptocurrency has soared, we are hearing calls for much higher values.
Michael Novogratz, a hedge fund manager, recently said Bitcoin could go as high as $40,000 by the end of 2018. (Source: “Bitcoin could ‘easily’ reach $40,000 by the end of 2018 hedge fund legend Novogratz says,” CNBC, November 27, 2017.)
But $40,000 may be considered a conservative estimate…
John McAfee, CEO of MGT Capital Investments Inc. (OTCMKTS:MGTI), predicts the cryptocurrency to soar to $1.0 million by 2020.
McAfee isn’t the only one with a $1.0-million Bitcoin prediction.
James Altucher, a former hedge fund manager and self-help guru, says the same. He argues, “There’s 15 million millionaires around the world. All their financial advisors are going to say, ‘Hey, buy a bitcoin. You need some exposure.’” (Source: “James Altucher predicts bitcoin will reach $1 million by 2020,” CNBC, November 29, 2017.)
Why could Bitcoin soar?
The cryptocurrency is being dubbed as a play against fiat currency. This is because unlike fiat currency, it can’t be printed out of thin air. There’s a limited quantity of bitcoins. It’s decentralized. There’s no “middleman.”
Some have even dubbed it as “virtual gold.”
Here’s the thing; as the cryptocurrency continues to soar, the predictions are taken as “possible” price targets.
But, What About Gold Prices?
Now, dear reader, look at gold prices.
We are seeing an interesting phenomenon; those who have out-of-this-world price targets for Bitcoin prices get a significant amount of air-time on mainstream media while those who say gold prices could go to $2,000 are being ridiculed.
I am not bearish on Bitcoin. I wouldn’t be surprised if the cryptocurrency goes to $15,000. The momentum is strong and it’s getting serious attention. Also, let me make it very clear; I am a big fan of the technology that backs Bitcoin (blockchain).
But what surprises me is that gold continues to get ignored in the midst of all this. It is the ultimate play on fiat currency. It has a very long track record of this. Gold is also rare and can’t be printed out of thin air.
I am looking at the rise in Bitcoin and asking: How long could gold prices remain suppressed? The yellow precious metal has remained suppressed in times when almost every other asset class has generated massive returns.
I really can’t help but be bullish on gold. From a fundamental perspective, the gold market has improved immensely. The longer gold prices remain at rock-bottom prices, the higher the move is going to be.
While the world is looking for Bitcoin mining companies, I am paying attention to gold mining companies. I have said this before in these pages; gold mining companies could be the next millionaire makers.