While Bitcoin has embarked on a steep recovery since the $3,700 lows seen in March, some have still been questioning the value of cryptocurrency. Case in point: a hedge fund manager named Mark Dow recently shared that he thinks the cryptocurrency is on the “edge of a cliff,” adding:
“I’ve been saying…that Bitcoin on the chart is facing massive overhead resistance. Based on this chart, this rn is a textbook opportunity to short,” he said while pointing to the below image.
But, according to a billionaire investor, the leading cryptocurrency is likely to perform extremely well in the coming weeks and months due to this financial trend.
Related Reading: Could Goldman Sachs’ Cheery S&P 500 Projections Boost Bitcoin Higher?
Bitcoin Could Boom Due to Federal Reserve Action
Recently, Mark Cuban — the billionaire owner of the NBA’s Dallas Mavericks, a tech investor, and a star of the reality TV show “Shark Tank” — sat down with prominent Bitcoin bull Anthony Pompliano to talk about global markets and what he would do as president.
Cuban said to Pompliano that Bitcoin is likely to benefit from the ongoing trend of governments and central banks printing money to combat the economic downturn we’re seeing at the moment:
“It’s Bitcoin’s potential benefit if everything goes into the shitter because we’re printing so much money, and there’s global implications, Bitcoin has something to deal with and something to say.”
Indeed, in the past few weeks alone, the following has transpired:
- The Federal Reserve dropped its policy interest rate to 0 percent
- The deficits of governments have skyrocketed, especially in the U.S.
- Sound finance has gone out of the window as central banks have printed billions and trillions of dollars
- And most notably, there’s been controversy about the extent of the corporate bailouts, which many say is too big compared to the relatively measly $1,200 cheque that all Americans will soon get.
All this, as Cuban says, could benefit Bitcoin, which compared to fiat currencies is relatively decentralized, scarce, not beholden to a central authority, and much more.
It isn’t only Cuban to have such a belief. Per previous reports from NewsBTC, Arthur Hayes, CEO of BitMEX, said in a recent newsletter that he thinks BTC is still on track to hit $20,000 by the end of this very year.
As to why he thinks this will take place, his thoughts were similar to Cuban. Hayes wrote:
“Everyone knows the shift is upon us, that is why central bankers and politicians will throw all of their tools at this problem. And I will reiterate, that is inflationary because more fiat money will chase a flat to declining supply of real goods and labour. There are only two things to own during the transition to whatever the new system is and that is gold and bitcoin.”
Photo by Pascal Debrunner on Unsplash