According to experts the cryptocurrency market could hit $1 Trillion this year with bitcoin surging to $50,000. Cryptocurrencies could go on a bull run even greater than last year and pass the trillion-dollar mark in terms of value, experts told CNBC.
Bitcoin has seen a huge fall this year so far, dropping below $6,000 for the first time since mid-November. On Wednesday, it was trading above the $7,000 level as the cryptocurrency market stabilized.
At its lowest point on Tuesday, the total cryptocurrency market saw over $550 billion wiped off its value. But industry insiders see another rally ahead.
Thomas Glucksmann, head of APAC business development at cryptocurrency exchange Gatecoin, told CNBC by email on Tuesday:
“Increasing regulatory recognition of cryptocurrency exchanges, the entrance of institutional capital and major technology developments will contribute to the market’s rebound and push cryptocurrency prices to all new highs this year. There is no reason why we couldn’t see bitcoin pushing $50,000 by December.”
With major banks blocking customers from buying Bitcoin with credit cards and governments cracking down on cryptocurrencies, a Senate hearing on the topic Tuesday was a surprising respite for Bitcoin and cryptocurrencies in general.
The Senate Banking Committee heard testimony from the chairman of the Commodity Futures Trading Commission (CFTC), Christopher Giancarlo, and the chairman of the Securities and Exchange Commission (SEC), Jay Clayton, on the potential dangers of digital currencies as investments. Their testimony, was surprisingly positive and as a result, Bitcoin prices rose to $7,650 on Tuesday, after dipping below $6,000 just a 24 hrs earlier.
“We owe it to this new generation to respect their enthusiasm for virtual currencies, with a thoughtful and balance response, and not a dismissive one,”
The technology advancements Glucksmann referenced include bitcoin’s so-called Lightning Network, which would boost the very slow transaction speeds using the cryptocurrency.
“One possible appetizer for the bulls, or the catalyst for the recovery, will be the release of another cryptocurrency backed instrument listed on a major exchange. There are several candidates in the pipeline, it’s only a matter of time until we have a cryptocurrency backed ETF (exchange-traded fund).”
Last year, the CME and CBOE both released bitcoin futures productsthat people could trade. And Nasdaq CEO Adena Friedman told CNBC in a recent interview that the exchange was “continuing to investigate” cryptocurrency futures.
The recent cryptocurrency sell-off came after huge price rises for many coins last year. Ethereum gained a massive 8,000 percent and ripple surged over 32,000 percent and the gold standard Bitcoin was up nearly 1,300 percent.
Even though the price rises were impressive, experts think that this year could be even bigger.
Jamie Burke, CEO at Outlier Ventures, a venture capital firm that focuses on blockchain investments, told CNBC by email on Tuesday:
“We believe after February the market will likely go on a bull run comparative if not greater than last year potentially reaching the trillion-dollar mark before a proper crypto winter sets in where the market becomes more focused on proper market fundamentals,”
Institutional money is expected to flow into cryptocurrencies this year, in much the same way that they moved in last year, and the number of new Blockchain technology and cryptocurrency hedge funds could triple in 2018 as Wall St. shows up to the party.
Michael Novogratz, the former macro manager who’s turned into one of the biggest champions of bitcoin, shelved plans to start a cryptocurrency hedge fund and predicted that the digital money may extend its plunge to $8,000. Novogratz isn’t giving up on them and said he still believes they’ll be a disruptive force in finance. He had said this month that bitcoin could reach $50,000 by the end of next year — upping his previous estimate of $40,000. Mike Novogratz just recently privately raised $250 million for his crypto merchant bank Galaxy Digital LP as coindaily reported two days ago and this was timed to coincide almost exactly with low point we hit in the bitcoin price at the beginning of February.
Matt Siebenthal, former macro Advisor and professional trader, is another huge believer in Blockchain Technology and the potential for it to revolutionize industry. Siebenthal shared similar sentiment in December with concern for valuations while many carelessly entered the space. The founder of BlockWealth Capital also postponed plans to launch a crypto hedge fund- citing a possible correction to 7500 or lower before the cryptocurrency market- led by Bitcoin resumes it’s uptrend, anticipating a bull run similar to 2017.
“If you follow the charts, there have been several big sell offs in January, usually followed by even bigger rallies.”