With Bitcoin gaining more than 60% in value in 2021, many in the cryptocurrency space are hopeful about the future of the flagship digital asset in 2022.
Speaking with CNBC, cryptocurrency lender Nexo founder, Antoni Trenchev, revealed that there are “two simple reasons” why he believes Bitcoin’s value will have more than doubled from its present levels by the middle of the year.
“Every time investors in the broader community write off Bitcoin, it outperforms significantly. This has been the case in 2020 when it rallied close to a 1000%, and on top of that, it rallied another 63% [in 2021]. I’m quite bullish on Bitcoin. I think it’s going to reach 100k this year, probably by the middle of it,” he said.
There are two reasons, according to Trenchev, for his bullish forecast that Bitcoin will hit $100,000 in the middle of 2022, the founder noted:
“We see institutional adoptions persevere quietly companies building out their treasuries filling it with Bitcoin. And also, the broader theme of macroeconomic realities and cheap money, in my opinion, is here to stay, which is great for crypto, which is an inflation hedge and gold 2.0.”
Rate hike will lead to dip in equities and bond market
The notion that cheap money is here to stay may be called into question by what the Federal Reserve (the Fed) is doing right now with interest rate hikes.
Trenchev believes that as soon as we see a rate rise, the stocks and the bond market would suffer due to this. His explanation was that there hadn’t been much of a political wheel to sustain any power through any sort of correction in the traditional financial markets in the last few years. Therefore, the Nexo founder considers the vast majority of people are wrong about the rate hikes by the Fed.
The evolution of cryptocurrencies
After being questioned on the evolution of cryptocurrencies and whether or not they are now being considered as a parallel currency, particularly for countries with fragmented central banking systems or financial systems, such as El Salvador, he responded to where is next by saying:
“I think Latin America is a poster child for what you just described. Economies with some difficulties so managing their own currencies and their respective central banks facing some challenges, so definitely all of them are potential candidates of adopting cryptocurrencies as legal tender.”
The Nexo founder remarked that it is incredible how far crypto, and Bitcoin, in particular, has come in just 13 short years and that this is both a store of value and a means of a medium of exchange, providing the best of both worlds, and that it is “definitely something that can boost a lot of the economies in the region that are facing some problems.”
Last year, Trenchev stated that more South and Central American countries adopting Bitcoin would push the price to $100,000 as they would act as a substitute to slowed institutional investment in Bitcoin.
Watch the video: Nexo founder sees Bitcoin hitting $100,000 in 2022