With only a few days left until the start of 2023, investors are wondering if Bitcoin and cryptocurrencies will be bullish. Some of the analysts commenting on this issue think that the bear market will end and the rise will come, while others think that the bears will continue to dominate the market and the declines will continue.
Research and trading firm Capriole Investments, which maintains its positive outlook on Bitcoin, said that even if BTC is about 80% below its all-time high, it does not expect a decline in the medium and long term. However, the company, which opened a parenthesis here, pointed out that Bitcoin could fall further in the current bear market conditions.
Expressing that it believes that 2023 will be bright for Bitcoin as a reserve asset, the company cited the financial history of the world economy in the last century and especially the gold and dollar policy of the USA in 1971. Because the USA, which promised to give an ounce of gold to those who brought 35 dollars until 1971, cut the bond of the dollar with gold this year. This caused gold to skyrocket to $400 in 1974.
Referring to the USA’s gold dollar connection in 1971, Capriole now links gold with Bitcoin.
“Gold was much smaller in the 1970s, but with a decade of inflation and high interest rates, it had the capacity to make big moves. Today, however, Bitcoin is even smaller. This is one reason why we believe that Bitcoin will do the same with gold and even more in the next decade.”
Continuing the gold Bitcoin benchmarking, the company said that when looking at BTC’s charts, BTC has the potential to repeat the movements of gold in the 1970s. The company stated that among these charts of BTC, there is also the cup and handle chart structure that has been going on since 2010. According to Capriole, even though Bitcoin represents only 2.5% of the market capitalization of gold and the market value of BTC is smaller than gold, Bitcoin has more growth potential than gold.
Because BTC has a more promising technology compared to gold. For this reason, Capriole underlined that a similar demand for gold in the 1970s could also occur for Bitcoin, arguing that this demand would lead to a 40-fold increase in price for BTC.