Afcacia’s prediction comes to pass as Bitcoin rallies past USD61,000

A prediction published by Afcacia last Tuesday that Bitcoin was likely to pass the USD60,000 mark by the end of the week came true on Saturday when the digital coin hit USD60,300 at 1230Hrs EAT.

The prediction by Nigel Green, the chief executive and founder of deVere Group, continued to hold true on Sunday, with Bitcoin reaching an all-time-high of USD61,680.60 at 0030Hrs EAT.

Mr Green had foreseen that due to US president Joe Biden’s approval of a $1.9 trillion stimulus package through the House on Tuesday, the cryptocurrency would record a historical surge in value.

“It’s already closing in on its record high hit in February and I believe that we can expect it to surpass this – likely reaching $60,000, this week.  Stimulus cash could be used by recipients to invest in cryptocurrencies for the first time or expand their existing crypto portfolios,” he said on Tuesday.

The stimulus package, he said, will be a considerable driver for the price of Bitcoin as creates the risk of debasement of the dollar, the world’s reserve currency, while also fanning inflation, forcing many traders to convert their dollars to Bitcoin.

Bitcoin is up about 1,000% in the past year amid signs of increasing institutional interest as well as speculative demand.

Bitcoin prices have more than doubled so far this year, up 107% from the December 31 closing price of $28,987.60. Investors are excited that Elon Musk’s Tesla (TSLA) said in February it owns $1.5 billion worth of Bitcoin on its balance sheet.

Tesla also has said it was looking at letting consumers use bitcoin to buy its cars and SUVs.That sparked speculation that other big companies may soon add bitcoin or other cryptocurrencies to their balance sheets, since bitcoin is generating a significantly higher return than bonds and cash.

Software firm MicroStrategy (MSTR) has also been actively buying Bitcoin. It is the company led by Michael Saylor that’s converting its cash into Bitcoin and now holds more than $4 billion of it.

Payments giants Square (SQ) and PayPal (PYPL) let their users buy and sell it. Credit card processing behemoths Visa (V) and Mastercard (MA) are also embracing cryptocurrencies.

BlackRock (BLK) and Bank of New York Mellon (BK) have started to dabble in Bitcoin, as well. Investors have been flocking to buy Bitcoin because of the perception that it could be a good hedge against inflation and a weaker dollar if bond yields continue to rise.

“There are obviously a lot of mining businesses out of Asia, and the pattern we’ve continued to see is that the selling is coming out of Asia,” said Richard Byworth, the CEO of Diginex Ltd, a digital asset financial services company.

“Intermittently that changes, but the buying is coming out of the U.S. where people are replicating MicroStrategy,” he said.

China accounts for about 65% of global Bitcoin mining computing power, according to the Bitcoin Electricity Consumption Index compiled by Cambridge University.

Coinbase, the biggest U.S. cryptocurrency exchange, filed last month for a Nasdaq listing. Regulatory approval would represent a landmark victory for cryptocurrency advocates seeking mainstream endorsement.

Amid rising customer demand to own and invest in bitcoin, Goldman Sachs Group Inc. said this week that it is exploring how to serve those clients while remaining on the right side of regulation. It recently restarted a cryptocurrency trading desk and this month it started dealing bitcoin futures and non-deliverable forwards.

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