Bitcoin price: Cryptocurrency expert reveals THIS reason why bitcoin could soon RALLY
BITCOIN price has seen a 27 percent increase since the start of April and one cryptocurrency expert said bitcoin is likely to continue to rally as historical data shows a continuous rise over the past eight years.
Bitcoin price took a hit in January after banks and officials faced increased pressure to regulate cryptocurrencies, but Pantera Capital CEO Dan Morehead thinks the worst is over for the cryptocurrency.
Speaking on CNBC, Mr Morehead said: “Bitcoin has been growing at 165 percent a year for the six years that we have been in business. And something that is growing that fast hardly ever gets down below its 200-day moving average.
“When it does it is a very good time to buy. It did five years ago when we launched our first fund and it just crossed that earlier in April.”
He added: “Technical traders use these different averages to decide when to get in.
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Bitcoin price: Dan Morehead said bitcoin could soon rally
“Bitcoin has been growing at 165 percent a year for the six years that we have been in business”
Dan Morehead
“But it is amazing that bitcoin gets up so much quickly and when it just gets back to its average, that means it is time to buy again because it has been a vertical line for eight years.”
Mr Morehead said he thinks there is a “rare opportunity” in bitcoin’s price decline since January.
He said: “In December, when markets were going vertical, we did raise some cash so that if they crash we could be fully invested.
“We are now fully invested and I think this is a rare opportunity to get into something 65 percent below its highs – you don’t get that opportunity very often.”
Bitcoin price was at $8,928.11 at 08:45 (GMT) on Monday, according to CoinDesk. It saw its highest value before Christmas when it reached the monumental price of just under $20,000.
The digital currency has faced criticism by banks and finance experts, with Banking giant Morgan Stanley likening the current market climate of bitcoin to the dot-com bubble that, during its most “exuberant” period rose by 250 to 280 percent.
Australia central bank governor Philip Lowe also said the fascination surrounding cryptocurrencies such as bitcoin felt more like “speculative mania”.
Mr Lowe said: “The value of bitcoin is very volatile, the number of payments that can currently be handled is very low, there are governance problems, the transaction cost involved in making a payment with bitcoin is very high and the estimates of the electricity used in the process of mining the coins are staggering.”
Bank of England Governor Mark Carney has also been highly critical of cryptocurrencies. He said it is a “privilege” to be part of the financial system and “responsibilities come with those privileges”.
Mr Carney added: “The best of the cryptocurrencies, I would suggest, will gravitate to the best of the exchanges if they were regulated. And others will fall by the wayside.”
But prior to the G20 summit in March, Mr Carney revealed cryptocurrencies do not pose a risk to financial stability.
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