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Prices surge after business magnate Elon Musk embrace bitcoin

Bitcoin Elon Musk_IFM_Image
Bitcoin is a good thing, said Musk showing his support of the cryptocurrency

Bitcoin’s price surge to reach $38,000 on Friday as Tesla chief executive said ‘bitcoin is a good thing’, media reports said. This is not the first time, Elon Musk shared his enthusiasm for bitcoin, as he previously tweeted that he would accept his salary in bitcoin.

Earlier this month, US-based multinational investment bank JP Morgan has made a bold prediction when it comes to bitcoin. According to the bank, bitcoin prices will hit $146,000 in the long term.

Comparing Bitcoin to traditional store of value assets such as gold, lead analyst Nikolaos Panigirtzoglou suggested that Bitcoin’s current market capitalisation of around $580 billion would have to rise by 4.6 times which would create a theoretical price of $146,000.

In a note, Nikolaos wrote, “A crowding out of gold as an ‘alternative’ currency implies a big upside for Bitcoin over the long term. A convergence in volatilities between Bitcoin and gold is unlikely to happen quickly and is in our mind a multiyear process. This implies that the above $146,000 theoretical Bitcoin price target should be considered as a long-term target, and thus an unsustainable price target for this year.”

However, Bitcoin fell sharply soon after losing ground from a record high of $34,800. Bitcoin’s record high came less than three weeks after it crossed $20,000 for the first time in December last year. The world’s biggest cryptocurrency more than quadrupled in price last year.

Last year, Blockstream chief executive Adam Back said that bitcoin hitting the $1 trillion market cap by 2025 is conservative. He expects bitcoin to hit the $1 trillion mark by 2022 or even sooner.

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