Make no mistake, Bitcoin (CRYPTO: BTC) is “The One.” And if we’re going to grasp its real value, we first have to analyze the problems it is so successful at solving.
Bitcoin was born to revolutionize the traditional payment system. It owes its existence to the problems the system itself has created. Today, it is clearer than ever that the repetition of these problems is getting more and more serious.
How is it possible that a country which built up the largest gold reserves in the world to back up its currency (backing that ended in 1971), the power to issue an international reserve currency (chosen with the world’s consensus at Bretton Woods), and the biggest oil agreements to back up that currency, has been contemplating a government shutdown over a possible default for the first time in its history?
It all comes down to utter negligence and malpractice, with the very few winning big time and almost everyone losing out in the end. The dollar has lost 98% of its value in 50 years but is still being recklessly issued without the slightest hint that it will stop. The fact is there simply isn’t any other way to pay off such debts.
Despite all the gold China has bought and the threat to the dollar posed by the birth of the petroyuan, the country is also in a similar plight and hasn’t been able to hide it from the outside world.
Between central banks with their unlimited quantitative easing and governments with their universal revenue, they would seem to be engineering a deliberate collapse. Distrust in national currencies is slowly spreading: it is no coincidence that the United States is seeing the highest inflation for more than 13 years. 38% of the historical monetary base created out of thin air in less than two years? Totally insane. The rest of the countries are in a similar or even worse state. And they think that, with their central bank digital currencies—CBDCs to you and me—everything will be different. Nothing could be further from the truth.
Total U.S. monetary base
That said, how does Bitcoin propose to solve this problem? Bitcoin is the only widely adopted payment system that isn’t built on debt. Its issuance rules are clear and tamperproof, with clear limits ever since its formation. Its payment system is decentralized: everyone can participate by validating their transactions in exchange for a reward. Moreover, the technology behind it is absolutely transparent and readily verifiable by everyone.
It has always been ridiculed and even treated as a bubble. Ultimately, everything is subjected to the same bubble: the bubble of currencies issued by central banks. Is Bitcoin part of that? Possibly, but even so, its value is real and scarce, and there is consensus around it. This asset is the only one on earth that has real answers to this big problem.
Though we at Finanflix agree it often sees very sharp upswings, these are natural movements in such assetss. It inevitably happens after its halvings because the new supply in these events is cut in half. You may be asking yourselves, “Aren’t these events discounted in the price?” Obviously not.
Long-term outlook:
This chart is the one we at Finanflix use most. It reflects the long-term Bitcoin price within the bullish channel it has carved out. We mark the halvings as vertical green lines on their respective dates. On the price side, we mark the bullish momentum with green boxes and pullbacks with red boxes.
As the chart shows, Bitcoin has always repeatedly displayed a strong post-halving upswing, and followed that, a logical correction until the next halving. These cycles are a natural trait of the asset.
Another matter of great interest is that the price has never retested its previous high (after a green box, it has never reconfirmed this support). We at Finanflix, therefore, predicted $20K bearish present, which we have established, in light of this prospect, to start in March 2022, before which the end-of-cycle target will reach $300,000 per unit.
- One country already has Bitcoin in its reserves, has declared it legal tender, its people have adopted this technology, and its government produces it using geothermal energy from its volcanoes.
- The FED declared that it has no intention of “banning” cryptocurrencies, which will definitely open up vast opportunities for the US.
In a nutshell, Bitcoin has become one of the most valuable assets, having a market cap of close to one trillion dollars. This is higher than many large companies, like Visa (NYSE: NYSE:V), Tesla (NASDAQ: TSLA (NASDAQ:TSLA)), Walmart (NYSE: NYSE:WMT), or Nvidia (NASDAQ: NVDA).
Rarely has an asset climbed to the top the way Bitcoin did in the 2020–2021 period. None of this has been a coincidence. J.P. Morgan, for example, started working with Coinbase (NASDAQ:COIN) after the 2020 halving (when its CEO said that Bitcoin was a worse bubble than the tulip bubble of 2017) and immediately the company’s lawyer, Brian Brooks, started working as US Acting Comptroller of the Currency at the OCC. A while later, Coinbase (NASDAQ: COIN) went public. Many companies and mutual funds began hoarding Bitcoin back then, and the asset was on everyone’s lips.
Bitcoin is The One. It still has so many incredible things in store for us.
Facundo Zamora - Founder and CEO of Finanflix
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