Some predictions about the price of bitcoin made recently by authoritative analysts are causing a commotion.
Particularly surprising is that of CitiBank MD and its director Tom Fitzpatrick, according to which BTC’s price could reach a high of $318,000 by the end of next year.
According to Fitzpatrick, Bitcoin may have the potential to become the digital gold of the 21st century.
This is obviously not a new idea, but it’s very surprising that it is coming from the director of Citibank, a historic financial institution founded in 1812 in New York City, with over 2,600 branches in 19 countries around the world.
The key point would be the possible upcoming devaluation of the US dollar, which is still the world’s reserve currency par excellence.
In such a scenario Fitzpatrick sees similarities with the gold market of 1970, whose assumptions were laid down in 1944 in Bretton Woods, and lasted until 1973.
In fact, the Bretton Woods agreements anchored the US dollar to gold, and that of other currencies to the dollar, in an attempt to build a monetary regime in which the US dollar was equivalent to gold as a reserve currency.
In the course of time, however, the gold markets became so popular with the dollar that in 1970 there was a kind of “gold rush”, during which the owners of dollars hurried to exchange them for gold. In 1971, President Nixon interrupted the pegging of the dollar to gold, creating the new fiat currency regime.
According to Fitzpatrick, the inflation of the dollar and its devaluation, have made it possible to make a comparison between bitcoin and gold, especially since Bitcoin was born just after the great financial crisis of 2008, when interest rates fell to zero percent for the first time.
This would have generated the first bullish bitcoin cycle, i.e. the one that started in 2011 and ended in December 2013, with a 555-fold increase in value.
Moreover, the current scenario seems similar to that of the financial markets at the beginning of the 1970s, the one that led to the gold rush.
According to Fitzpatrick, a bitcoin rush could start at this point, which could bring the price up to $318,000 by December 2021.
Analysts’ conflicting predictions about Bitcoin
However, it should also be added that not all analysts are so bullish about bitcoin.
While it is difficult to find authoritative downward predictions at this time, there are analysts who assume a consolidation phase, with relatively stable prices, or others who predict price increases of a much lower order.
In truth, the figures hypothesized for 2021 are so different from each other that they reveal considerable uncertainty.
It is decidedly probable that the predictions of the great majority of the analysts regarding the prices of BTC for 2021 are simply wrong, but it is worth noting that very few believe that the price can go down, and that not many believe that it will lateralize.
In other words, bullish predictions prevail, but there does not seem to be any convergence between them.