spot_img
spot_img
28.2 C
Lagos
Sunday, July 3, 2022

Weiss Rating Bullish on Bitcoin, says Price to Hit $70K Next Year

Must read

Weiss Ratings has outlined key reasons why investors should be bullish about bitcoin, seeing a “ferocious rally” with the price of the cryptocurrency expected to hit $70,000 next year.

In addition, the Federal Reserve’s massive money-printing and institutional investments into cryptocurrencies add to the bullishness.

Weiss Ratings analysts Bruce Ng and Juan Villaverde explained that investors should be bullish about bitcoin despite some sideways consolidations. Weiss Ratings currently ranks bitcoin first among all cryptocurrencies overall.

One of the three key reasons why the analysts are bullish about bitcoin stems from a price prediction based on the stock-to-flow analysis (S2F).

The popular forecasting model “now points to a ferocious rally over the next 12 months or so,” they wrote.

Ng and Villaverde described that “S2F is based on the common-sense notion that the scarcer a commodity is, the more valuable it becomes,” adding that scarcity is measured by circulating supply.

For example, Gold has an S2F of 62, which is “the number of years of current production required to match global above-ground holdings,” they clarified.

After the May Bitcoin halving, 6.25 new bitcoins are being created every 10 minutes, meaning “it would take an estimated 56 years for new mintage to match Bitcoin’s circulating supply,” they continued.

“Notice how close that is to the S2F number for gold, which makes sense because bitcoin is fast becoming a major rival to gold as a safe-haven investment.”

The other two reasons Weiss Ratings’ analysts highlighted were “QE infinity” and institutional money flowing into cryptocurrencies.

The covid-19 pandemic environment has pushed the Federal Reserve to print $2.9 trillion in new paper money in just 13 weeks, or about $22 million a minute, the analysts detailed.

“By any measure, this is corruption of money on an industrial scale,” they exclaimed, predicting that investors will pour money into bitcoin and gold “as a safe haven when they lose confidence in paper money.”

- Advertisement -spot_img

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

- Advertisement -spot_img

Latest article