Citibank executive noted that Bitcoin is going through a similar period to that of Gold in the 1970s and expects a potential breakout next year.
In a moment of excitement for Bitcoin investors, Wall Street banking giant Citibank expects Bitcoin (BTC) price to hit $300K by the end of 2021. It means that BTC price can 18.5X from the current levels surging more than 1700%. Well, crypto analysts have been giving such massive targets for a long time. But it seems that even senior executives of banking institutions have started believing in the Bitcoin story.
Thomas Fitzpatrick, a managing director at Citibank, expressed his views on Bitcoin, in a report for the bank’s institutional clients. In the report, Fitzpatrick cites similarities between Bitcoin and the gold market of the 1970s. He notes that Bitcoin’s journey so far consists of major price swings “exactly the kind of thing that sustains a long-term trend”.
The report got leaked in the crypto community last Saturday, November 14. Twitter user “ClassicMacro” first noted that Fitzpatrick is popular for giving “moon targets”.
Citibank bitcoin technical analysis.
Target: Moon. pic.twitter.com/prB1YjVNhX
— Alex (@classicmacro) November 13, 2020
So, what holds the basis of Fitzpatrick’s assumption that the Bitcoin (BTC) price will hit $318K by December 2021? Well, it’s nothing but the plain old technical analysis (TA). Looking at Bitcoin’s weekly chart of previous highs and lows, the Citibank executive gave this new target for Bitcoin (BTC). In another tweet, ClassicMacro mentions:
“This kind of technical analysis is of little value. There is no edge in guessing targets so far in time with TA. All we know is that price is likely to continue going up. What matters here is Citi’s clients being exposed to the bitcoin moon”.
Citibank: Classic Bitcoin vs Gold Comparison
Bitcoin vs Gold has been a long-going debate within the investors’ community. Often called the Digital Gold, Bitcoin is slowly emerging as the alternative to the yellow metal and a potential hedge against the uncertain economic conditions.
The Citibank executive stated that BTC’s “exponential move” during 2010-2011 is “very reminiscent” of the 1970s gold market. Fitzpatrick notes that over the last 50 years, Gold has experienced restricted movement in the price range between $20-$35 before the breakout finally occurred when the Nixon administration changes the fiscal policy in 1971.
Fitzpatrick notes that the COVID-19 pandemic offers one such opportunity to Bitcoin. He notes that with central banks pursuing aggressive quantitative easing measures, it can lead to explosive BTC price growth. Along with Fitzpatrick, major personalities from the crypto community have been hinting at BTC being the potential hedge against Fed’s money printing policy and a possible inflation surge ahead.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.