The year 2019 posed as a perfect example of the volatile nature of cryptocurrencies as the price of Bitcoin spiked during the beginning of 2019, however it witnessed a massive drop following the recent crash in the crypto market. The surge in the king coin’s price in early 2019 if often correlated to the entry of various institutional investors into the ecosystem. However, the institutional interest towards the digital gold seems to be depreciating, reports suggest.
Physically settled Bitcoin futures products were still encountering low volumes following the launch of Bakkt as it marked its first block trade settle recently.‘The Tie’, cryptocurrency trading researchers revealed a significant drop in headlines for the terms “institutions” and “bitcoin”.
Mentions of institutional interest in Bitcoin in news headlines have plummeted to a 2019 low after seeing significant growth throughout the summer.
Data from over 85,000 unique publication headlines collected since October 2017. pic.twitter.com/3JqHEpIAF8
— The TIE (@TheTIEIO) October 2, 2019
Bitcoin is often compared to gold due to several similarities including its limited supply. The mention of the word ‘gold’ in Bitcoin headlines also seemed to have hit a two-year low, the analyst revealed.
Mentions of the word "gold" in Bitcoin headlines have hit a low since at least October 2017. After bottoming in April conversations around Bitcoin and Gold had surged over the summer. pic.twitter.com/qUPmJcZBXR
— The TIE (@TheTIEIO) October 3, 2019
Additionally, various other signs of institutional interest descending from the cryptocurrency scope consist of the price of the Grayscale Bitcoin Trust’s GBTC tumbling to a 7-month low.
Bitcoin can reach $25K if usage crosses 1M people: Thomas Lee
Managing Partner and Head of Research at Fundstrat Global Advisors, Tom Lee, recently made an appearance on CNBC‘s ‘Street Signs Asia‘ segment to talk about Bitcoin price movements in the future. Lee also spoke about why he thinks Bitcoin will touch $25K by 2022.
According to Lee, for an industry that’s over a decade old, these are still early days for digital assets. However, as time passes, it will become very institutional, he said. Fundstrat’s Lee added,
“Over time, it’s going to become an asset class, and once we hit that it’s actually another hockey stick.”
When asked about his prediction for the king coin’s price, Lee said that it had been established back in 2017 as a five-year prediction. According to him, the predicted goal would be easy to achieve due to cryptocurrencies being network value assets — the more people that hold it, the greater its value.
“In fact, it’s a log function, so if you double the users you get a quadrupling of value, and to go to $25,000 you essentially need a 4x rise (a little bit less than that) which means you need to double the number of people who hold Bitcoin.”
According to Lee’s estimates, there are under half a million people in the world who own and use Bitcoin widely today. He also compared Bitcoin to Internet stocks such as FAANG and attributed 70% of their returns since the IPOs to the growth of the Internet over that period of time.
“So in other words, it was a log function of the Internet growth, and that’s how cryptocurrencies are going to work. That’s just saying if you take it to a million users, you could get to $25,000.”