Dan Morehead, the CEO and co-chief investment officer of blockchain-focused investment firm Pantera Capital, has revealed the firm’s bitcoin price prediction is ahead of schedule and the price of BTC could break through the $100,000 mark soon.
In a letter to investors published on Medium, first spotted by Daily Hodl, the firm’s CEO wrote that when the price of bitcoin plunged in March of last year when the World Health Organization declared the coronavirus outbreak a pandemic and top U.S. stock indices entered bear market territory, he assured investors it would set a new record over the next 12 months.
Morehead’s thesis was based on institutional investors entering the cryptocurrency space. He detailed his experience trading bonds showed that when things turn sour in the rest of the market, some assets go up and crypto is one of them.
It took a few months to stabilize. A few months for the rally to build steam. Now it’s full on. My instinct from trading many cycles over 35 years is that crypto prices are going to melt-up. We’ll see much higher prices before this cycle is over.
The bitcoin price rally is, in fact, ahead of Pantera’s original prediction. As of March 15, the rally is three weeks ahead of schedule based on analysis to bitcoin’s stock-to-flow ratio after its third halving in 2020, which reduced block rewards from 12.5 BTC to 6.25 BTC per block.
The S2F model is a way to measure the abundance of a particular asset. It measures the amount held in reserves and divides it by the amount produced annually. The amount of new BTC’s being minted per year dropped in half last year with the halving, increasing scarcity.
The price of bitcoin broke $60,000 earlier this month to hit a new all-time high above $61,800, before enduring a slight correction. The cryptocurrency, according to Pantera Capital’s prediction, is 0on track to surpass “$115,000 this summer.”
The firm added that its exposure to digital assets allowed its funds to outperform the market. The S2F model, it’s worth noting, goes beyond the $100,000 price prediction and could see BTC hit $288,000 if correct.
Morehead added that Pantera’s chore thesis is “that unlimited money printing will push up the price of things whose quantity cannot be eased.2 the thesis has seen Pantera’s funds go up “immensely,” and exposure to decentralized finance (DeFi) is also benefiting the firm.
Featured image via Pixabay.