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Bitcoin Is Already In The Top 10 Most Expensive Exchange-Traded Assets In The World

Feb. 11, 2021 1:18 PM ET
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  • Bitcoin will live.
  • If you invest in bitcoin right now, there is a high risk of ending up in the situation of those investors who bought bitcoin in December 2017 :).
  • Maybe it will take several more years to reach the $ 100,000 mark.

A year ago, I wrote an article in which, together with experts in the finance and crypto industry, I tried to figure out the chances of bitcoin rising again and “flying to the moon.” It seemed that the odds were pretty good — both the technical and fundamental analysis and additional factors indicated that.

Then the corona crisis hit, and it seemed as if that should have dramatically stimulated bitcoin’s growth. People are staying at home, banks are hastily trying to go digital, and not all of them succeeded. It’s time to install crypto wallets and start ordering products online with bitcoin payment, isn’t it?

It seems to be so, but here the service infrastructure as a whole was not ready. Unfortunately, the amount of retailers accepting cryptocurrencies is still relatively small. The Bitcoin breakout happened neither in the spring nor in summer. Instead, bitcoin took off in the fall, and how!

At the end of November last year, bitcoin began increasing rapidly, and already in mid-December, it surpassed a historical record amount of $ 19,500 (according to Coinmarketcap). The first cryptocurrency didn’t stop there — on January 8, 2021, the price reached $ 41,300. This mark was temporarily the highest amount for a month up until earlier this week when bitcoin jumped to $ 46,000.

The obvious stimulus for bitcoin’s growth on February 8-9 was the Tesla report’s data to the US regulator SEC. The report indicated that the company invested $ 1.5 billion in Bitcoin. In a commentary, Tesla said that corporate rules regarding investing were updated in January: the company wants to make its asset portfolio more flexible.

To sum up, it’s a kind of double hype — the company which, according to analysts, is overvalued 10-15 times, provoked a new wave of growth of the asset, the value of which no one can really estimate. However, the capitalization of bitcoin is not difficult to determine, and at the moment, there are only six exchange-traded assets in the world with a higher capitalization — these are Tencent, Google (Alphabet), Amazon, Microsoft, Saudi Aramco, and Apple.

Nevertheless, whether the latest spurt of bitcoin was due to the hype or not, there are fewer doubts about cryptocurrencies’ global success every year. Yes, this take-off will be more than likely followed by a logical correction of 20-30%. Maybe it will take several more years to reach the $ 100,000 mark, or perhaps we will see such a price in the near future. Currently, for myself, I draw at least two conclusions:

  1. Bitcoin will live.

  2. If you invest in bitcoin right now, there is a high risk of ending up in the situation of those investors who bought bitcoin in December 2017 :).

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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