TL; DR Breakdown
- Bitcoin has potential to achieve another 10x in price.
- BTC is not as volatile as claimed.
- Many DeFi projects will fade off.
There have been a lot of Bitcoin price predictions from crypto investors and analysts as well as other influential market players like Binance CEO Changpeng Zhao. During a recent interview, the CEO fronted a rather optimistic prediction for Bitcoin this year. He said BTC is a much better asset to hold value than fiat currency.
In his prediction, Zhao opined that Bitcoin has the potential to spike by between five times and 10 times by the end of 2021. That’s in addition to the currently established crypto bull run that took Bitcoin’s price to a new ATH of around $42k before the crypto drew back to trade at around $35k. Zhao backed up his views with a few strong points.
Governments have been printing lots of cash
For one, governments have been printing a lot of fiat money during the Covid-19 pandemic. This is claimed as an effort to implement quantitative easing in hopes of reducing the economic effects caused by the outbreak.
As a result, fiat currencies are now losing value. CZ estimated that the US Dollar alone has been inflated by between 20-30%. That makes a strong case for people who want to preserve the value of their wealth to buy Bitcoin, thereby contributing to a rise in its demand and the subsequent Bitcoin price increase. CZ seems to have a lot of confidence in Bitcoin, as revealed by his recent tweets.
Bitcoin price is less volatile than most other assets
A lot of Bitcoin opponents have expressed pessimism about it, saying it’s highly volatile. However, according to Binance CEO, BTC is actually way less volatile than some other popular assets like Tesla’s stocks. That means owning Bitcoin is less risky than owning Tesla shares.
Majority of DeFi projects will fail
The rise of DeFi has been another development that has given Bitcoin a much-needed push to go mainstream. Many DeFi projects have been launched, but CZ has some bad news about them. According to him, it’s likely that a majority of the current such projects will not survive in the long run. Either way, there is a strong indication that Bitcoin price will continue its upward trend.