Analysts predict the price of Bitcoin can fly to the ‘crazy’ mark of $ 1 million?

According to CNBC, some financial regulators believe that Bitcoin price could reach $ 1 million in the long term, but organizations like JP Morgan warned of the risks if the digital currency continues. price increase.

Morgan Creek Digital Assets co-founder Anthony Pompliano predicts that Bitcoin price could reach $ 500,000 by the end of the decade and it is possible to hit $ 1 million in the distant future.

“I think Bitcoin can become the new reserve currency in the world and their total market value can surpass gold,” Pompliano told CNBC.

Over the past few months, the Bitcoin price has broken many records and recently surpassed the threshold of $ 50,000 for the first time in history.

Why does Bitcoin go up in price?

According to experts, the reasons for the price increase of this virtual currency are many. First, a series of financial institutions and reputable private investors poured money into Bitcoin, which prompted the virtual currency to go up.

In addition, the fact that many payment platforms accept Bitcoin also makes speculators more confident in the virtual currency’s prospect.

In 2020, Square announced to buy some bitcoins while Tesla billionaire Elon Musk also said he bought about $ 1.5 billion.

In addition, a series of central banks loosening money to stimulate the economy, such as lowering interest rates, buying back bonds, implementing quantitative easing (QE) … to combat The recession caused by the Covid-19 epidemic also made Bitcoin more attractive than other investment channels.

“Trillions of dollars have been printed and added to the economy so everyone, from individuals to organizations, to companies are looking for ways to protect their assets, and Bitcoin is an option :, Mr. Pompliano stressed.

Investors predict the price of Bitcoin to reach $ 1 million based on a number of factors, for example this virtual currency has a maximum of 21 million “coins” meaning limited in supply.

In addition, the freedom of the platform prevents Bitcoin from being tied to any central bank in the world, thereby pushing the price of the currency up without fear of the control of the authorities. .

Although there are many so-called “Bitcoin miners”, these are in fact just hardware lenders to perform transaction steps in the Bitcoin Blockchain chain. In return, these people will receive Bitcoin as wages.

If there are more and more “Bitcoin miners”, there are more computers that can help with transactions and no individual or organization can control the virtual currency.

The fact that these “Bitcoin miners” use powerful machines to perform the algorithm makes this virtual currency the currency using the most modern computer system in the world.

“The more people joining the market will make Bitcoin increase liquidity. As the liquidity goes up, the use of Bitcoin will be more and more, thereby stabilizing the price of this currency … In the economy.” In fact, at first there was no currency, but Bitcoin would take that position when it becomes the reserve currency of online users, “Pompliano confirmed.

JP Morgan’s warning

In January 2021, JP Morgan predicted that Bitcoin could reach $ 146,000 and compete with gold’s investment channel. Previously, gold was a safe haven for investors, now Bitcoin is becoming a new option.

“Bitcoin is competing with traditional gold, this virtual currency is becoming a kind of ‘electronic gold’ for investors,” emphasized JP Morgan strategist Nikolaos Panigirtzoglou.

According to Nikolaos, the total value of gold held by the private sector, which is often used to shelter assets, is up to 2.7 trillion USD. If Bitcoin wants to reach this number then the virtual currency’s price would have to reach $ 146,000.

However, because there is no government, Bitcoin is very volatile. Expert Nikolaos said that this virtual currency fluctuations in price 5 times stronger than gold.

According to Nikolaos, the main reason Bitcoin’s price volatility stronger than gold is due to its lack of acceptance by financial institutions and widespread application. The use of this currency by more and more organizations and consumers will quickly stabilize the volatility of Bitcoin’s price.

However, Expert Nikolaos warns the risk when Bitcoin has continuously increased in price over the past time. The fact that more individual investors sitting as traders has pushed the price of the currency up but when the economy reopens, people have to go to work and less time to speculate at home then things may be different. .