$80K Bitcoin and $3K Ethereum?

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Frank Holmes, CEO/CIO of US World Traders, believes Bitcoin and Ethereum may attain $80,000 and $3,000 respectively in 2021. He additionally sees the potential of Bitcoin dropping to $20,000 and Ethereum dropping to $500. This vast unfold is derived from a philosophy he calls the DNA of volatility.

DNA of volatility

In keeping with Holmes, every asset class has its personal DNA of volatility, or the everyday share of worth fluctuation over a time frame. He finds it significantly intriguing when two totally different belongings have related volatilities. On this interview, he factors out that the DNA of volatility of Tesla is identical as Ethereum.

The inventory market, the S&P 500, is 1%. Gold is 1%. Gold shares are 2%. However Tesla is 5%. Ethereum is 5%. Bitcoin is 5%.

So why do these two seemingly disconnected belongings have related DNAs of volatility? Holmes believes {that a} greater vary of volatility is an indicator of a disruptive asset. Tesla is disrupting the automobile trade whereas cryptocurrencies are disrupting the worldwide monetary sector. Though these belongings inhabit wholly totally different industries, they’re each brokers of change, which creates related uncertainty and volatility in worth.

Bitcoin will turn into artwork

The crypto area is legendary for high-flying Bitcoin worth predictions. Some, akin to Dan Held, even imagine Bitcoin could hit $1,000,000 per coin. But when Bitcoin have been to succeed in even a 3rd of that quantity, how wouldn’t it occur?

“What’s going to drive it to $400,000 valuations, I hear, is as a result of it’s going to turn into artwork. It’s going to be categorized as a collector’s merchandise.”

Trying 3-4 years down the street, Holmes postulates that Bitcoin will nonetheless be helpful as artwork even when it doesn’t turn into the sovereign digital cash it was initially constructed to be. He likens proudly owning Bitcoin to having an unique Andy Warhol print, besides Bitcoin is way extra transactable.

“It’s wonderful…and there’s a restricted provide!”

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