Weekly Round-up — 22/1/21
Price and market fluctuation
After achieving a new ATH this week of over $1,400, Ethereum may have a promising future, and may hit $20,000 according to a recent report that uses Metcalfe’s law. Although it may seem implausible now, there have been greater rises. For example when ETH went from $10 in early 2017 to over $1200 in 2018, over a 10000% increase which compares to a 1400% increase if the price went from $1,400 to $20,000.
Cryptocurrency whale, Grayscale, now owns 3% of all circulating Bitcoin. If they maintain the rate they are purchasing Bitcoin, acquiring 60,000 BTC this month alone, it’s quite possible for them to own 10% within a year. Would this be good for Bitcoin?
Skybridge COO, Brett Messing, strongly believes in the power of Bitcoin, claiming that it can achieve a price that succeeds $500,000 as a result of institutional investors. Messing currently sees Bitcoin as a niche asset and is confident it will hit $100,000 within the next year.
Recently speaking out about cryptocurrency, possible future U.S Secretary of the Treasury, Janet Yellen, viewed cryptocurrencies ‘as a particular concern’ in regards to criminal activity. However, in 2020, it is believed that only 0.34% of transactions were involved with illegal ventures according to a recent Chainalysis Blog. Could this simply be a cover for deeper concerns?
Gregory Pepin, Deputy CEO of Deltec Bank, assured the public on a podcast on Friday that “Every Tether is backed by a reserve and their reserve is more than what is in circulation. Despite the coin’s transparency having been questioned for some time now, and a recent medium post informing users of certain discrepancies, Pepin is adamant that there is enough fiat to cover Tether.
Future of cryptocurrency
Former U.S Treasury Secretary, Dr. Lawrence H. Summers, firmly believes in the prosperity of Bitcoin claiming that it ‘is here to stay’. Rated as one of the top economists in America, Summers, believes that due to the finite nature of Bitcoin its future looks promising despite fluctuations in the market.
Stephen Harper, former Canadian Prime Minister of nine years, shows his appreciation for cryptocurrency stating the possibility of Bitcoin serving as a reserve currency. Due to the fall of gold and the rise of Bitcoin, it becomes a serious contender considering its value both now and possible future.
Cryptocurrencies are generally not regulated and investors do not have access to recourse or compensation schemes such as, for example, in the UK, the Financial Ombudsman Service or the Financial Services Compensation Scheme. Investing in cryptocurrencies can be high risk and investors should carefully evaluate their appetite for risk and their understanding of trading cryptocurrencies prior to entering into a transaction.