Bitcoin prices may skyrocket to $2 lakh this year: Analyst – Economic Times

The rally in Bitcoin and other cryptocurrencies hasnt run out of the steam despite the 500% surge in 2020, says Charles Edwards, founder, Capriole Investment a digital asset management company specializing in cryptocurrencies such as Bitcoin. In an interview with ET, Edwards says the reduction in supply of Bitcoin along with high inflation rates could auger well for digital currencies.

What is your 2021 outlook for Bitcoin? Any price target or estimate as to how the asset will perform in the year?2021 will is a special year in the Bitcoin cycle. A number of factors are aligning for Bitcoin right now:

I go into 2021 with great confidence the next 12 months will be no different.

I expect to see Bitcoin reach prices in the region of $100K-200K in 2021 and would be shocked if it doesnt hit at least $50K. Prices as high as $300K plus are definitely viable.

The return potential for Bitcoin in 2021 is incredible.

From there, each person will need to determine the appropriate amount and way to invest in Bitcoin. A time tested and successful approach to reducing risk and getting great returns over the long term is to dollar cost average allocate a percentage of your income each month to automatically buy Bitcoin. This approach reduces the impact of large downdraws and has historically achieved great returns.

What are the key challenges you see for Cryptocurrencies in the next one-two years?There are only two challenges I consider for Bitcoin over the coming years:

Sooner or later governments will realize that Bitcoin is not a gimmick. It is a fundamental challenger to all fiat currencies. I expect we will receive announcements over the coming years of Bitcoin replacing a number of small country currencies. As Bitcoin grows, into the multi-trillion-dollar market capitalization in 2021 and beyond, this perceived threat will grow clearer to larger countries. The only way an individual country can effectively ban Bitcoin here is to outlaw or excessively regulate Bitcoin to the point that it becomes unusable.

Hacking of the Bitcoin blockchain is also broadly a risk. Again this risk is small today.

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Bitcoin prices may skyrocket to $2 lakh this year: Analyst - Economic Times