- Bitcoin’s recent crash has left it with plenty of work to do in order to regain all-time highs
- There are three clear paths it can take for the rest of 2021, but what is the most likely?
- We run through the options ahead of Bitcoin in 2021
Bitcoin has endured a chastening few weeks, with the highs of $65,00 feeling like a long distant memory. Following its sharp 41% correction, what could the rest of 2021 hold for Bitcoin? We run through the possibilities and pick the most likely outcome.
Up Only
Thesis: Bitcoin uses the drop to $38,000 as a springboard, reversing its losses as quickly as it made them and returning to the $60,000 range before you can say “can I cancel my Tesla order?”. The up only trend is resumed, and the race for six figures is on.
Impact on alts: Alt season is officially over as Bitcoin takes charge, taking the liquidity away from them
End of year Bitcoin price: $100,000 or thereabouts
Likelihood: 1/5
Mini-Bear Market
Thesis: Bitcoin cauterizes the wounds caused by the drop to $38,000 and spends the next few months flip-flopping around $40,000-$50,000 as it nurses itself back to health. It then embarks on a typical end of year rally, taking it past all-time highs.
Impact on alts: Alts continue to enjoy a fruitful summer, making new all-time highs and recovering their Bitcoin-comparison price, until Bitcoin takes over in late 2021.
End of year Bitcoin price: $65,000
Likelihood: 4/5
Show’s Over, Go Home
Thesis: Bitcoin’s four-year cycle officially comes to an end and it enters a bear market. The price continues to drop to the last cycle’s high of $20,000, bottoming out in 2023.
Impact on alts: Alts enjoy a blow off top before the usual collapse, with many lesser projects shutting up shop or simply exit scamming. A new breed of bagholders is born.
End of year Bitcoin price: $20,000
Bitcoin Set for Slow Recovery Before Winter Windfall
As you can see, we don’t believe that Bitcoin’s bull market is over, but a period of consolidation is almost certain. A few months of recovery would prepare Bitcoin for another run towards all time highs later in the year, giving alts more chance to show some strength in the intervening months. This will give alt holders a great chance to rack up the gains to convert to bitcoin when the time comes.
