$30k By The New Year? Anything Is Possible

Up close to 300% in 2020, is bitcoin a bubble? Does it even matter when compared to the “everything bubble” that cheap fiat currency has grossly inflated this year?

To answer that, let’s consider how bitcoin works, and the time-tested economic principle of supply and demand. 

Prior to May 2020, bitcoin miners received 12.5 bitcoin tokens per new block created. Now, miners receive just 6.25 bitcoin tokens per block — this means that roughly 900 new bitcoin tokens enter circulation every day. By the time we reach the sixth Halving event in 2032, 99% of all Bitcoin that will ever exist will have been mined.

That means there’s less and less for a market that has an increasing appetite for hedging out of fiat.

The demand for bitcoin from MicroStrategy alone was roughly 3,000 per day during that 10-day span — tripling new bitcoin supply. Furthermore, there’s plenty of additional ongoing demand from other institutions and retail investors alike. 

Fresh highs, notably all-time highs. that bitcoin continues to demonstrate motivates traders to continue scooping up shares of bitcoin miner stocks like Bit Digital, Riot Blockchain, and Marathon Patent Group. As of noon EST, here’s where these stocks were:

• Bit Digital was up 23% but had been up 39% earlier in the session.
• Riot Blockchain was up 10%, down slightly from up 12% earlier in the day.
• Marathon was only up 5% but had traded 10% higher shortly after the market opened.

These three stocks aren’t just big winners today, they’re also among the biggest winners in 2020. Not only is each one at least a 10-bagger and crushing the market, each is also drastically outpacing gains from bitcoin. And that could be a long-term problem for investors.

Needles to say, there’s a lot of promising signs that the Bitcoin price could be on its way towards $30,000 by the upcoming New Year’s eve. Here are three reasons why a continuation rally could happen.

#1 A BIG FAT STIMULUS CHECK

The US House of Representatives passed legislation on Monday to increase direct economic relief to millions of Americans after President Donald Trump’s unilateral demand.

The measure, which passed with a 275-134 vote in the Democratically-led Congress, proposed to change the stimulus checks amount from $600 to $2,000. It came a day after Mr. Trump signed the second COVID-19 relief bill on Sunday night, paving the way for a $900 billion aid to reach American households and businesses.

Bitcoin reacted optimistically to the stimulus news, very much in the line of its previous rally that followed the US government’s $2.3 trillion coronavirus aid announcement in April 2020. The cryptocurrency mainly retraced higher after Trump signed the bill, confirming that traders and investors treat the stimulus events as bullish.

Therefore, if the Republican-controlled Senate lets the amended bill go through with a winning vote, the stimulus package’s overall size would increase by extensive margins. That, in turn, would pressure the US dollar lower further, benefiting Bitcoin in the process.

#2 A $100M INVESTMENT FOR BITCOIN

As the stimulus expansion reaches an impasse, Bitcoin has found more reasons to grow its market cap — thanks to its ever-expanding institutional base.

Another Nasdaq-listed corporation joined the ranks of mainstream companies and investors that have invested in Bitcoin. Greenpro Capital, a Hong Kong-headquartered business intelligence firm, announced it would raise debts worth $100 million to buy Bitcoin, calling the cryptocurrency “a reliable future store of value.”

“I’ve instructed our investment bankers to raise debt in Q1, 2021 of up to US$100M to invest in $BTC,” confirmed CEO CK Lee, adding that Greenpro “will also invest its own cash into BTC.”

The news further attested to the theory that institutions would purchase Bitcoin even as it trades near its all-time highs. That could allow traders to spot potential accumulation zones to plan their medium-to-long-term bullish bias, creating an ideal setup for the price to claim the $30,000-level.

#3 GOOGLE TRENDS

Internet searches for the keyword ‘how to buy bitcoin’ attained a perfect score on a 12-month timeframe, suggesting that the cryptocurrency market now attracts more retail players.