In the past two days, Bitcoin is firmly standing above the $50,000 mark.
This means that in 2021, the increase has already exceeded 83%.
All predictions about Bitcoin's performance in 2021 need to be re-evaluated from a new starting point.
After all, the current round of rising has even broken the annual "Chinese New Year effect"-investors will cash out and leave the market due to increased spending during the Chinese New Year, leading to a price drop.
And to directly promote this round of Bitcoin's rise, you have to mention Ellen Musk, the man behind Tesla, who is even more known as the "Silicon Valley Iron Man."
Musk has been vigorously carrying cryptocurrency recently, and with his appeal, he not only succeeded in igniting Doge on Twitter (rapidly soaring by 50%), he also spent $1.5 billion to buy Bitcoin through Tesla.
It can be said that it has successfully advanced to the top stream in the cryptocurrency field.
But Tesla's investment in Bitcoin is not an isolated incident. We have seen more and more listed companies in the United States using Bitcoin as an alternative reserve asset.
In other words, the value of $50,000 in Bitcoin may be just a starting point.
Regret for not buying Bitcoin 8 years ago
Although Musk's enthusiasm for cryptocurrencies has been very high in the past two months, this enthusiasm has been formed through a long accumulation.
"For a long time, many of my friends have tried to persuade me to participate in Bitcoin."
Musk first came into contact with Bitcoin in 2013. He received a "Bitcoin cake" from a friend and ate it.
"Obviously, I should have bought some bitcoin at least eight years ago." This is Musk's recent view.
But until May 2020, he only had 0.25 bitcoins donated by his friends-although he had already explained to JK Rowling that bitcoins are more reliable than large-scale fiat currencies.
Then after the bull market in the second half of 2020, Musk's enthusiasm for Bitcoin has increased significantly.
As soon as 2021, Musk changed his profile to "#bitcoin" on Twitter and said that he is a supporter of Bitcoin.
In addition, investors who watched closely like Levinhoek discovered that Tesla has buried the layout of cryptocurrencies on page 106 of the 2020 annual report (the title is ambiguous "Note 23-Follow-up events").
Later, Tesla revealed that it plans to spend 1.5 billion US dollars to buy Bitcoin, and will accept Bitcoin as a payment method in the near future.
At present, Tesla has completed the purchase of Bitcoin through Coinbase, and has partially supported the use of Bitcoin to pay for car payments and deposits.
It is worth noting that in addition to Bitcoin, Musk has been calling for Dogecoin.
Musk publicly stated in 2019 that Doge is his favorite cryptocurrency, not to mention at the beginning of 2021, claiming to be the "former CTO of Dogecoin", which brought Doge, which had already soared, to a more violent surge.
However, Musk admitted some time ago that in fact those are just joking, "Joke is to make fun of cryptocurrency."
In the end, he did not forget his humor, "But fate likes irony, and the most interesting and ironic result is that Doge will become the currency of the earth in the future."
Why high-profile entry?
On the premise that the legality of Bitcoin's securities is still unclear, Tesla has invested in Bitcoin as an intangible asset with an indefinite period, which can be said to be a very high-profile entry.
Behind the high-profile entry is a judgment based on the high overlap between inflation expectations and regulatory expectations.
The first is inflation expectations.
There is no doubt that market inflation expectations are rising and will continue to rise, which means that companies will increase their demand for safe-haven assets.
Bitcoin has been incorporated into asset allocation by more and more traditional investment institutions, and Bitcoin’s performance is indeed amazing.
Compared with institutions such as family offices, listed companies with stricter supervision have also begun to follow suit in asset allocation.
In 2020, at least 15 listed companies have bought bitcoins, holding more than 100,000 bitcoins in total.
In this year, Bitcoin went from a trough of less than $4,000 to more than $40,000.
Market inflation expectations in 2021 will not be lower than in 2020, so it can be predicted that, in order to beat inflation, hot money will flock to the stock market and the more risky cryptocurrency field.
The second is regulatory expectations.
The US Securities Law's treatment of Bitcoin is currently unclear, so there are no corresponding accounting standards and tax rules.
And the SEC has rejected all applications for Bitcoin-based ETFs.
But it is clear that Bitcoin is an asset recognized by law and the market (although it is a virtual asset).
What is clear is that Microstrategy, which purchases bitcoin on a large scale, has not been punished by supervision, which means that the supervisory authority has acquiesced in this behavior.
In addition, it is clear that it is within the scope of the law to directly hold Bitcoin through compliant exchanges such as Coinbase, or participate in Bitcoin indirectly through Grayscale Funds.
As Bitcoin becomes more and more of the mainstream financial products, I believe that the corresponding regulation will soon follow, but it is certainly not blocked.
So based on the above two expectations, recently we can see MasterCard and Bank of New York Mellon US listed companies have begun to deploy Bitcoin.
There is also China's US stock-listed company, 500 Lottery, which has acquired BTC.com, the third-ranked mining pool in Bitcoin computing power.
Although this is easily reminiscent of the eve of each bubble burst in Bitcoin's history.
$50,000, then?
Since Bitcoin broke through $50,000 and has been included in asset allocation by more and more listed companies, the value of Bitcoin should be revalued at the current starting point.
Normand, a strategist at JPMorgan Chase & Co., is not optimistic about the current Bitcoin price.
He believes that Bitcoin is very likely to shrink-because Bitcoin's rise is steeper than any other financial innovation or asset bubble in the past 50 years.
QCP Capital, a quantitative trading company in Singapore, is very optimistic, predicting that Bitcoin has a 10% chance of priced at USD 400,000 by the end of the year, a 15% chance of USD 300,000, a 30% chance of USD 160,000, and a 50% chance of high. At $100,000.
The judgment of Joel Kruger, a cryptocurrency strategist at LMAX Digital, reconciles the two views.
"We recommend being extra cautious in the short term. Bitcoin has been in a parabolic state since it broke through $20,000."
"Technical research warns of the need for a healthy pullback in the coming days and weeks to normalize severe stretch readings."
