Bitcoin (CCC:BTC) sure has a nice, digital sparkle to it Wednesday morning after setting a new all-time high. And importantly, this all-time high comes just weeks after the cryptocurrency set its last record at the end of November. So with crypto bulls all jazzed up, what do you need to know? And what bitcoin price predictions are floating around for 2021 and beyond?
To start, investors should know about the new record high for bitcoin. Earlier this morning, the cryptocurrency climbed as high as $20,817.80. Although the price has since dropped slightly to near $20,700, there is no reason to fret. Clearly, things are moving in an upward direction with this leading crypto name.
Just think about. In December 2017, bitcoin hit a record of $19,783. After that, it dipped lower, worrying investors that the so-called digital gold had lost its touch. Those fears began to subside in 2020 when a variety of macroeconomic catalysts started to boost bitcoin prices. And just like that, the crypto hit a high of $19,850 on Nov. 30, 2020. Importantly, since hitting that high in November, experts have continued to set higher bitcoin price predictions for 2021 and beyond.
So what else do you need to know today? And where could bitcoin be headed in the future? There is no one clear answer to that, although many experts are wildly bullish. In the previous weeks, we have seen analysts set 2021 price targets near $50,000 and $100,000. In fact, Citibank analyst Tom Fitzpatrick recently set a bitcoin price prediction for 2021 as high as $318,000.
With these price predictions and yet another all-time high in mind, the bull case is just getting stronger for bitcoin. The logic goes that this time around, the rally will hold up. Why? With more support, more products and big-picture catalysts, cryptocurrencies make a whole lot of sense.
Where Do High Bitcoin Price Predictions Come From?
As investors consider the bitcoin all-time high, it is also important to consider where this high comes from. And largely, investors can thank Covid-19.
What do I mean? Well, the novel coronavirus has massively weighed on the economy. To combat this, Congress and the Federal Reserve have taken up all sorts of fiscal and monetary policies to buoy the stock market and help get the economy back on its feet. We have seen the CARES Act and unprecedented bond-buying programs from the Fed. Plus, lawmakers are once again debating a second round of stimulus funding. Even if we do see legislation come through before the holidays, chances are that a President Joe Biden would usher in even more sweeping relief measures.
For crypto bulls, that creates a perfect scenario to dive into bitcoin and other cryptocurrencies. You can see it as a safe-haven asset, a hedge against inflation or simply an investment in the future of finance. In fact, beyond the bitcoin price predictions, many think the new bitcoin all-time high will boost support for decentralized finance. This means that in the coming weeks, some experts think DeFi projects that rely on Ethereum will see the benefits.
Keep an eye on bitcoin. Who knows when the next all-time high is coming.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer with InvestorPlace.com.