Bitcoin will continue to rally towards $ 50,000 as investors move from gold to digital assets, according to Mike McGlone, chief trading analyst at Bloomberg.

In his opinion, by 2024 volatility may reach the gold level, which will lead to even greater price increases.

In a report released on Wednesday, McGlone clarified that BTC is showing strong support of $ 30,000, and “increased institutional acceptance and potential to convert benchmark index into global reserve activity” could push the price to $ 50,000 or higher.

The report cites evidence that funds are being diverted to Bitcoin from gold, highlighting an acceleration of flows to the Grayscale Bitcoin Trust (GBTC) and a decline in the total known ETF holdings. Investment firm GBTC increased its fund GBTC from 1% to 10% from $ 210 billion of gold tracked ETFs during 2020.

“In the digital world, it makes sense to expect more money to go into bitcoin rather than precious metals,” he said.

McGlone believes that investing up to 5% in Bitcoin is becoming an increasingly wise decision:

“In the absence of major technological disruption, old guard distributors are mainly at risk if the cryptocurrency becomes a reserve asset and Bitcoin, with 1-5% of mutual funds making more sense.”
The strategist explained that the increase in stock market volatility bodes well previously for gold and bitcoin, as total investment in bitcoin and gold showed a 260 days lower level of volatility (30%) compared to the S&P 500 (35%). ).

However, McGlone believes that the digital asset has the potential to increase the resistance level by 100 times compared to gold. Current BTC resistance levels ($ 40,000) are 22 times higher than gold ($ 1,800).

During the 2017 bullish campaign, the Bitcoin to Gold ratio jumped from 1x to 15x in a few months.

McGlone said that Bitcoin will be well on its way to reaching the risk level for gold by 2024. In fact, he said, Bitcoin may become less volatile than gold due to steady supply.

“To get close to that milestone, Bitcoin may just have to maintain what it did: inflation and maturity.”
The current 260 days volatility for BTC is 50%, which corresponds to the 1980 gold volatility level.

McGlone also mentioned Ethereum and said that it makes the $ 1000 resistance level a support level that is unlikely to be broken. Compare this trend to the trend in the first quarter of 2017, when it rose from $ 10 to over $ 40, and nine months later it rose to over $ 1,000.

Source: CoinTelegraph