On 16 December 2020, the cryptocurrency world saw history being made when Bitcoin crossed the USD 20,000 record in its rate. The current period is seeing a lot of price fluctuations. So, it is obvious to wonder what comes next.
Two experts on the matter, CEO and co-founder of CoinRoutes, Dave Weisberger, and “The Case for People’s Quantitative Easing” author, Frances Coppola answered their views. In this article, we bring forward the basics of their discussion.
Also read: Grayscale Holds Currently $13B Crypto Assets
Significance of the record-breaking moment
Coppola is of the view that Bitcoin prices at the current time are bringing in more investors. Sure, the “institutional investors” do not yield big commons, but the author suspects more will still trickle in.
As for Weisberger, he is of the view that the “price action” at the current time is “instructive.” While the record-breaking moment brought in sellers, they were not all “natural” sellers. Mostly, these were spectators only, and that contributed to the hike. According to Weisberger, while it is not easy to guess what comes next, the USD 20,000 mark can form a fresh “support level.” Of course, the price can fall again.
How will the financial support affect the rally of Bitcoin?
Coppola states that most investors believe that cryptocurrencies like Bitcoin are more attractive. This depends on the increase in inflation and debasing of fiat currencies. So, Bitcoin’s future depends on how much the interest rate spikes and if the fiscal support unwinds. If governments reduce deficits and tighten their monetary policies, investors would lose interest in Bitcoin. And that would result in its decline.
Weisberger also comments the non-inflationary financial policy of Bitcoin is successful after the unprecedented economic debasement. So, these two factors would continue to power the Bitcoin rally.
Weisberger and Coppola also debated on the concern of Bitcoin replacing the dollar as the global default currency. The latter called it a “pipe dream” while Weisberger considered the notion “interesting and could gain favor.”
Also read: Binance Down As Bitcoin Crosses $20K