Bitcoin’s 2020 price performance saw its price reach an impressive $28,891.61 on December 31 last year – a figure decidedly on the high side even among the crypto asset’s most ardent bulls. However, with the Bitcoin bull continuing into 2021 and attaining a price of almost $60,00 in February, before a sharp loss $46,500 at the time of writing on 23 February 2021 – investors have their work cut out to predict the BTC 2021 price through the rest of the year.
JPMorgan & BTC 2021 Price Predictions – Bullish or Bearish?
There’s no doubt that the flow of institutional money has started with Bitcoin, as the most powerful investment companies are seemingly being forced to take cryptocurrencies seriously. JP Morgan Chase & Co is one such company, who have seemingly paradoxical views on the potential for the BTC 2021 price. On the one hand, a research release from the firm in early February, gave the view that the price of BTC at the time (around $48,000) was potentially ‘unsustainable’ due to the cryptocurrency’s historical volatility.
“In other words, bitcoin, at current market prices, has already more than doubled relative to gold in risk capital terms. In our opinion, unless bitcoin volatility subsides quickly from here, its current price of $48,000 looks unsustainable…”
From one perspectives, the current dip of Bitcoin to around $46,500 at the current time of analysis, supports the view that Bitcoin’s volatility may continue to see its price fall rapidly during drawbacks. However, from another perspective, the fact that BTC’s price nearly reached $60,000 towards the end of the third week of the month, also highlights the potential for Bitcoin to dramatically increase in value, following potential dips and corrections. Should BTC continue to gain value during the current bullish cycle, then it’s not inconceivable that Bitcoin can consolidate a price well in excess of the $50,000 marker, even if it encounters some sharp price corrections and sluggish performance phases, at some points in the rest of 2021.
It’s also worth noting that despite its reservations about Bitcoin volatility, JP Morgan has also stated that the company would definitely start trading BTC at ‘some point’. The company also has something of a poor record at predicting Bitcoin prices. In 2016, Chairman and CEO Jamie Dimon called Bitcoin “a fraud” and “worse than tulip bulbs”, while in 2017, he reportedly said he would fire any employee trading BTC on company accounts.
It’s also worth considering, that JP Morgan has hinted at some more bullish figures for Bitcoin 2021 prices and into the future. In early February, the company suggested that if BTC’s market cap of close to $575 billion (at the time), grew approximately 4.6 times, it could attain a price projection around $150,000. While this figure might be too extreme for 2021, during BTC’s February peak, the market cap did for a time exceed 1 trillion (a landmark figure), which does make the case for a potentially bullish 2021 Bitcoin price projection, if we we see sustained bull runs.
Retail Investors Pushing BTC 2021 Price Gains?
The recent Gamestop and Reddit shorting saga, illustrated the power that social media can have in harnessing the concentrated impact of small retail investors. If small investors can combine to literally drive market dynamics, then the effects on 2021 Bitcoin prices could be influential. Indeed, the gains witnessed in 2020 were in no small part, due to increased retail interest in Bitcoin – something again noted in a recent release from JPMorgan: “What has been remarkable over the past five months is that the $700 billion increase in the market cap of Bitcoin has taken place with relatively little institutional flows…” Bitcoin needs a new surge to exceed the 1 trillion cap marker again, but the growing interest of BTC among the mass psyche, would drive-up demand and positively impact prices.
The impact of lockdowns, socio-economic changes, digital disruption, ESG investing, millennials and generation x, emerging crypto and blockchain ecosystems and flourishing social media crypto space – are all increasing interest in crypto among retail investors. Increasing numbers of retail investors are entering the market for the first time, while many existing speculators are going long on Bitcoin; if the mass market crypto investors and sheet volume has anything to do with it, Bitcoin’s 2021 price will consolidate and exceed $60,000.
Institutional BTC Price Influence
Despite the decentralised allure of Bitcoin and its price being driven by retail investors for many years, there’s no doubting the fact that institutional money is starting to have a big impact on BTC and the crypto-sphere. Companies such as Square, with a $10 million commitment to a Bitcoin Clean Energy Investment Initiative, and Paypal’s acceptance of cryptocurrencies, are just two bits of news that drove prices up in 2020. In 2021, we’ve already seen Elon Musk and Tesla buying 1.5BN in Bitcoin, causing Bitcoin to rapidly gain price once the news went mainstream.
Bitcoin may be getting some negative press from the likes of Bill Gates and Janet Yellen, whose labelled Bitcoin as ‘Extremely inefficient’, but this news is being tempered by the likes of Bitcoin mining firm Northern Data, who is is rumoured to be planning to list in the U.S. in order to raise $500 million. There are two sides to BTC institutional story – those seemingly keen to push its adoption and price higher, and those who are potentially against a financial revolution with Bitcoin at the helm as a store of value.
Conservative predictions for 2021 BTC Prices
In 2021,we can expect retail and institutional investment in Bitcoin to increase and accelerate. Despite the potential for volatility, a conservative prediction would be for BTC to therefore consolidate a price in the range of $50,000 – $60,000. While a global recession or stock market crash may could negatively impact Bitcoin prices, crypto is also arguably an asset that may thrive if we see a weaker dollar and low interest rates. If the current BTC bull run continues and current price dip to around $45,500 at the time of analysis in February, is merely a correction, then $50,000+ maybe be a conservative 2021 Bitcoin price target.
Bullish predictions for 2021 BTC Prices
If we assume that BTC is currently aligned with a well-adjusted price, then the progressive penetration of institutional money into the space, combined with growing retail interest, may logically push Bitcoin into a zone between $60,000 and $100,000 as the market cap increases. Reaching over $100,000 in 2021 is a long-shot, realistically requiring a market cap gain something probably in the region of 500% from the current cap.
Overall prediction for Bitcoin 2021 Price: $50,000 conservative – $100,000 bullish.