Morehead, who’s also the chairman at Bitstamp, a global digital currency marketplace, predicted during an episode of Laura Shin’s Unchained Podcast that Bitcoin’s price may reach $42,000 by the end of this year.
Morehead explained that his price predictions were based on his analysis of BTC’s price movements on a logarithmic scale. Unlike regular charts that track simple fluctuations in price, logarithmic charts show price movements based on percent changes over time.
Crypto prime dealer SFOX also recently published research which suggests that Bitcoin’s value may increase substantially toward the end of 2019.
May take another 10 years for Bitcoin to mature
In response to a question about the current state of development of the crypto industry, Morehead referred to the Gartner Hype Cycle, which assesses the level of hype that may be created around innovative technologies.
According to Morehead:
“A small kernel of something very important gets people to be crazed about [Bitcoin] and then [there’s a] trough of disillusionment. And we’ve already gone through two of those cycles in the six years that we’ve been investing in [cryptocurrencies].”
He added that the Bitcoin protocol and its blockchain network are still in their early stages of development. It will take at least another decade for Bitcoin’s technology to fully mature and achieve mainstream adoption, Morehead said.
While clarifying that the Bitcoin price does not always reflect the present state of development of the wider blockchain ecosystem, Moorehead pointed out:
“If you ever go back and zoom out your lens more than a year, Bitcoin as a proxy for the industry is always going up.”
Long-term investment strategy
The Pantera CEO revealed that his company’s crypto investment fund only experienced one year of net losses during the six years of its existence. This, as the annual low for BTC price has only been lower than the previous year’s low on one occasion.
Explaining that his company takes the long view toward Bitcoin investments, Morehead said:
“We’re always trying to look three to five years out and be thinking about where the industry will be then rather than worrying about these kind of manic phases of bubbles.”
When questioned about the current state of the crypto industry in terms of the different hype cycles, Morehead noted that Bitcoin’s price chart appears to be fairly consistent when examined on a logarithmic scale. The extreme price bubbles created due to surging crypto prices in 2013 and 2017 can be seen clearly on these charts, the Pantera Chairman confirmed.
$365,000 Bitcoin price by end of 2021
Notably, Pantera Capital’s analysis of Bitcoin’s price movements indicates that its price could reach $122,000 by the end of 2020, and as high as $365,000 toward the end of 2021.
Acknowledging that the price estimates sound “crazy,” Morehead remarked:
“Essentially, we’re half way back there. It’s right on the trend line, and I think it’s a good shot that by the end of the year [the bitcoin price reaches $42,000.]”