Could Bitcoin Hit $100 000?

The total market cap of the cryptocurrency market keeps updating all-time highs and is now close to $1.5 trillion. Most of the credit here to bitcoin, which was quoted around $38000 on Monday, and is now pacing toward $50000 resistance.

Aggressive Bitcoin purchases were the reaction of traders to the news from Tesla (NASDAQ:TSLA). The car firm owner Elon Musk said that taking the general hype around the crypto industry, as well as the unprecedented  BTC growth observed lately, his company can no longer stand aside and is going to update its investment policy, adding digital currencies to the list. At the moment, we are talking about $1.5 billion worth of Bitcoin that has already been acquired by Tesla. Although this investment is scanty compared to other massive investments that have been made into the industry in recent weeks, let’s keep in mind a famous quote that “everything in this world starts small and then becomes bigger”. It’s also worth noting that Tesla buying BTC is a sort of an industry precedent, meaning other companies are likely to follow Tesla's lead. The market is already becoming anxious that there may not be enough bitcoins for everyone. When an asset is actively acquired not only by billionaires and retail traders but also by giants and mega-cap companies, the shortage of supply becomes just a matter of time.

According to the recent data released by Bloqport, a crypto research and analytics firm, 211 new Bitcoin wallet addresses with at least 1,000 BTC were created since the beginning of the year. Glassnote reported the number of new bitcoin wallets has reached a new high at around 1.34 million, surpassing the previous 1.28 million peak registered on Dec. 14, 2017. Statistics show that the BTC exchange rate and the number of active addresses demonstrate a positive correlation. This could be another indication that BTC hasn’t exhausted its upside potential yet. Meanwhile, BTC supply in exchange wallets has reached its lowest in almost 2.5 years. It should be noted that Bitcoin stored in exchange wallets has been steadily decreasing since March 2020. According to CryptoQuant statistics, as of Feb. 6, 2021, this figure was 2.3 million. 

Institutional investors largely constitute bitcoin’s scarcity. Emerald Mutual has recently reported that it owns more than 78,000 shares of Grayscale Bitcoin Trust. According to Bitcoin Treasuries, the Grayscale bitcoin trust controls more than half of all digital assets. The Grayscale Bitcoin Trust currently holds 649,130 ​​BTC.

Based on fundamental and technical analysis, as well as amid huge demand for bitcoin from all categories of investors, its growth may continue with the next target at the psychological resistance of $50000. Most analysts believe that BTC has enough grounds to hit the $100000 mark in 2021.