Analysts at Bernstein have identified five key catalysts for the current and future momentum of cryptocurrencies, according to Investing.com.
Experts maintain a constructive outlook on the prospects of digital assets. In their view, Bitcoin could benefit from the same macroeconomic factors as traditional gold.
The first cryptocurrency, compared to precious metal, has a higher beta and “resilience reserve,” the experts noted.
The five catalysts for Bitcoin’s further growth are as follows:
- A more stable capital base and a wave of institutional acquisition. During February-March, outflows from BTC-ETF amounted to ~$4 billion, and in April, it slowed down significantly. About 80 corporations hold Bitcoin on their balance sheets, some of which continue to increase their positions.
- New purchases for strategic reserves. Experts anticipate that the US may potentially expand its Bitcoin reserves. Proposals are being considered for financing through the revaluation of gold certificates or issuing bonds backed by the first cryptocurrency.
- Adoption by banks. Digital assets are becoming mainstream thanks to regulators and institutional interest—they are exploring stablecoins for cross-border settlements and expanding their presence in custody, management, and trading segments.
- Regulatory momentum around “stablecoins.” An expected shift in US regulation of the sector will showcase the technology beyond the cryptocurrency market, primarily in the area of money transfers and B2B payments.
- A push from asset managers and brokers. Global financial institutions are investing in infrastructure, viewing blockchain as the foundation for the tokenization of capital markets.
As reported, the first cryptocurrency will continue to appreciate if threats to the independence of the Fed persist, according to Standard Chartered.
Earlier, BitMEX co-founder Arthur Hayes predicted that the value of digital gold would rise above $100,000 due to the US Treasury’s buyback of government bonds.