© Reuters. Crypto Bull Rally: Will Bitcoin Cross $100,000 in 2023?
Benzinga - Not everyone suffered from the recent banking crisis. Crypto aficionados have become a fortuitous winner, with Bitcoin, the largest cryptocurrency by market capitalization, soaring nearly 70% since the start of the year.
Institutional traders believe the brutal year-long crypto winter is finally over, with the current macro backdrop reflecting a trend reversal.
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Crypto Rally 2023
bitcoin hit a all-time high of $68,991 in November 2021 before the onset of the brutal crypto winter. But recent market conditions have investors singing a different tune, touting Bitcoin as a safe-haven asset and store of value. While many advertised Bitcoin as an inflation hedge, the Federal Reserve aggressively warmongering position brought decentralized tokens out of favor last year.
In the wake of the recent banking crisis, analysts predict that the Fed will slow its rate hike path. Bitcoin has also long been considered a store of value. Other popular cryptocurrencies including Ethereum (ETH/USD) and meme token Dogecoin (DOGE/USD) also performed well. Goldman Sachs recently stated that cryptocurrencies hold a 20% market share as a store of value.
Other blockchain-based assets also performed well. Gameflip is a gaming and NFT marketplace with over $160 million in lifetime volume on their platform. The startup also has a live StartEngine boost, which means anyone can invest for a limited time. The startup is approaching $1 million raised in its current round from retail investors.
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BTC: the new digital gold
Last month's banking crisis exposed the systemic weakness of the global banking system as behemoths including the second largest Swiss bank Swiss credit and the 16th largest U.S. bank at the time Bank of Silicon Valley, have closed. The advantages of decentralized tokens have been highlighted in the wake of recent bank failures, with many proclaiming Bitcoin to be the new digital gold.
"I think the rally can be explained by saying that people have been spooked by the banking system because of the meltdowns," said Oliver Linch, CEO of Bittrex Global.
Changpeng Zhaoco-founder and CEO of Binanceconsiders Bitcoin to be better than gold.
As the crypto rally takes off, analysts and institutional investors are betting on Bitcoin to hit an all-time high again this year.
"I think Bitcoin is probably breaking all-time highs this year," said Marshall Beard, chief strategy officer at cryptocurrency exchange Gemini, adding that the cryptocurrency could hit the $100,000 mark.
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Vijay Ayyarhead of international at crypto exchange Luno, said: “Overall we seem quite bullish here with Bitcoin recovering $28,000 and looking to target $30,000 next.”
On March 17, former Coinbase CTO Balaji Srinivasan bet $2 million that Bitcoin could cross $1 million in just 90 days as hyperinflation kicks in. Notably, Bitcoin is expected to rise nearly 3,500% over the next three months. to reach this mark.
The blockchain-based gaming market is set to benefit from the crypto rally to reach a valuation of $50 billion by 2025. This represents a 33x increase from the market size of $1.5 billion reported in 2021.
Fed Scaling Back and Future Of Crypto
The Fed's dovish stance should fuel the bullish case for crypto as decentralized currencies regain momentum. Typically, Bitcoin has outperformed other major asset classes in a bull market.
"Any time you hold Bitcoin in a rolling four-year range, so you pick the day, hold it for four years, you've outperformed every other asset class," said Anthony Scaramucci, founder and managing partner of SkyBridge Capital.
But the disappointing jobs report and weak economic data released earlier this week steered investors toward reliable asset classes, including gold. As recession fears take hold, crypto could see a massive influx of investment, as people continue to bet on decentralized assets.
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Coming tensions
The U.S. Treasury has deemed decentralized financial markets (DeFi) a threat to U.S. national security, citing the requirement for additional regulatory oversight. This, coupled with the US Commodity Futures Trading Commission lawsuit against Binance, signals significant regulatory headwinds for the crypto industry. But as the US dollar slides amid Fed easing monetary policy and macroeconomic jitters, Bitcoin could retain its position as the best-performing asset in 2023.
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