Dangerous expectations aren’t new in the bitcoin world, users will benefit from resounding a bigger audience to convince them that cryptocurrencies are a safe digital asset, rather than a speculative fad. The most repeating prediction is that bitcoin is the currency of the future and will end up replacing all classic currencies. But this has also exposed criminals but there are ways to prevent online bitcoin theft.
During 2021 the upward and downward trends that BITCOIN has played contribute to reinforcing the volatility of such an influential digital currency.
Aspects that influence the price of bitcoin
The bullish cycles aim to grow much more, among some of the metrics that are analyzed before the movements of BITCOIN and that can help us to visualize what is going to happen with this digital currency, one of these is “THE STOCK TO FLOW”, which assumes that scarcity governs price, which is defined by the relationship that exists between circulating supply and the flow of new bitcoin production through mining.
Historically this model is the one that has been used the most to predict the value of BITCOIN, with this metric it is observed that every four years in a fixed way the offer of BITCOIN is reduced by 50%, which impacts the price and makes the predictions regarding its value very close to reality.
Media hype is the most important source of influence on the price of bitcoin and other cryptocurrencies. Advertising may not increase people’s understanding, but it does stimulate investor interest.
With the news or gossip, spreading like wildfire, the price of BTC is significantly affected by mass hysteria; consequently that what makes the most noise in the investment and financial environment is what will ultimately generate the most profits to investors.
Another aspect that determines the price of Bitcoin is that, as we previously said, the price of this cryptocurrency is governed by the general law of supply and demand.
The supply of Bitcoin is often compared to gold, as there is a limited amount of bitcoins that can be mined – only 21 million. The demand side here works the same as with any other asset: the more investors are willing to enter the bitcoin market, the higher the price of bitcoins.
Most important guarantees that support BTC
As if this were not enough to be able to predict the future value of BTC, the influx of institutional investors and the adoption of the cryptocurrency by companies or institutions of great weight in the world economy come into play, giving Bitcoin more legitimacy as that spreads within the traditional financial system.
Without a doubt, this is one of the most important guarantees that represent a support for the cryptocurrency market, because its creation and development in the investment environment have always been questioned.
Bitcoin price fluctuations may also be affected by the Bitcoin community in their effort to reach a consensus on the future development of Bitcoin. Decisions influence the Bitcoin blockchain and the entire Bitcoin ecosystem.
Lack of consensus can lead to a fork or split in a blockchain, just as it did when Bitcoin split into two separate blocks: Bitcoin and Bitcoin Cash – each following different rules.
Some analysts are predicting that bitcoin will hit $ 400,000 by 2025. If it sounded outlandish when the prediction was first made, why not think about it now that bitcoin’s price is currently above $ 60,000, it no longer sounds like a lofty target.
It is even likely that by 2030, most of the available BTC will have already been mined, which means that supply and demand will probably not influence its price. Instead, its availability and acceptability as a form of payment will do so.
By then, millennials and Gen Z will control the majority of commerce and, having grown up in the digital age, may prefer digital assets to physical ones. That could mean Bitcoin is more widely adopted than ever.
Current projections for the coin are optimistic, which will undoubtedly influence more people to invest in it. If that happens, the price of Bitcoin can exceed $ 1,000,000.
Conclusion
However, that’s almost 30 years into the future, and it’s challenging to make long-term predictions, especially at that scale. There are too many variables at hand that we cannot say with confidence. At the moment, we can be optimistic that Bitcoin reaches all the other predictions that have been heard for a long time.
