Bitcoin has experienced bear like cycles in its valuation throughout its existence over the almost 9 years. The world’s largest cryptocurrency would see itself rise in value by several hundreds of percent and then drop down by around 70 to 80 percent in its value during a correction midterm.
2014 saw Bitcoin suffer one of the worst corrections in Bitcoin’s short history when it went down in its value by 80 percent within the space of a year. All things considered, this year so far has been a faster version of the year long correction four years ago. The similarity between the two can be drawn by looking at the fact that both of these corrections came because of either individual trader bubbles or because of the booming of retail.
A popular hedge fund trader and researcher in the Bitcoin universe known as Spook has recently made a prediction that Bitcoin will hit the $50,000 mark by the end of 2018.
Is That Possible?
In light of the historic trends, after a correction where the value has dropped by 70 to 80 percent, Bitcoin has surged back by substantial degrees. Even though there is the need of a short term of considerable stability in its valuation (two weeks at best), Bitcoin has always made it past its all time highs once that correction has happened.
Bitcoin does have a tendency to violently fluctuate in its prices, seeing massive gains and massive losses within a short timeframe. If traders are looking for profits 10 to 20 times than what they have invested, they need to be prepared for 80 percent in losses on their investments as well.
The possibility of Bitcoin rising up to the $50k mark as predicted by Spook seems likely to happen. One of the reasons for that being considered an inevitability is the historic trends that the cryptocurrency has followed and as you know, history tends to repeat itself.
The second factor coming in to make it a possibility is that Cboe, one of the biggest options exchanges on the planet has filed for a Bitcoin ETF with the SEC. This will make it more likely for the United States Securities and Exchanges Commission to approve the first Bitcoin Exchange Traded Fund.
That and the fact that the parent company is reportedly going to offer cryptocurrency custodianship in the near future might make Spook’s prediction about Bitcoin reaching the $50,000 mark a reality.