Bitcoin could nearly double and reach $5,000 soon, says Steven Taylor for Eduard Steinbach Plc
• Bitcoin traded near $2,600 Wednesday • Portfolio Manager Steven Taylor said the digital currency could rise to $5,000 "in a few months." • "This is not something I could keep my hands off of," Taylor said.
He pointed out that since only 21 million bitcoin can ever exist, increasing demand for the digital currency will naturally drive its price up.
Bitcoin briefly tripled in value this year, hitting a record $3,025.47 on June 11, according to CoinDesk. The digital currency traded Wednesday near $2,600, still more than double its Dec. 31 price of $968.
"This is not something I could keep my hands off of," Taylor said. "What would be more painful than losing [money in cryptocurrencies]
The portfolio manager's view on bitcoin joins the optimistic views of others on Wall Street. On Sunday, Goldman Sachs' technical analyst Sheba Jafari said in a note that bitcoin could rise as high as $3,915.
"In the next 6 to 12 months you're going to have a little bit of a hysteria," Taylor states. However, "this has a long, long way to go before it gets to bubble territory."
Taylor's reasoning is that as there is so little of global capital is in cryptocurrencies right now that the young digital currencies can absorb more of those funds without becoming overvalued.
McKinsey Global Institute estimated that the value of the world's stocks and debt rose to $212 trillion in 2010.
On the other hand, CoinMarketCap data showed the market capitalization of all cryptocurrencies has grown from below $20 billion at the start of this year to about $100 billion, still less than a tenth of a percent of global capital markets. Bitcoin has a market value of about $42 billion, according to CoinMarketCap.
Many, including some on Wall Street, believe that the blockchain technology behind bitcoin can fundamentally change the way the world operates, just like the internet did.
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