The Motley Fool

Could bitcoin hit $25,000 by year end?

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

A depiction of the cryptocurrency Bitcoin
Image source: Getty Images.

This week, bitcoin investors have been subject to a bout of volatility, the likes of which has come to define the cryptocurrency.

The price of bitcoin slumped 10% on April 26 to $8,800 from $9,700 following the news that the defunct cryptocurrency exchange Mt Gox moved 16,000 bitcoins from its vaults to an unknown address sparking concerns that a price crash was imminent. However, so far no crash has materialised, and the price has since recovered somewhat.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

On the road to recovery 

After a rocky 2017, the price of bitcoin has been more stable this year. It seems the market has matured to some degree and it is starting to attract more traditional investors such as George Soros. 

Indeed, it was recently reported that the investor, who is best known for breaking the Bank of England, is looking to invest some of his $26bn fortune in the cryptocurrency market.

It’s this interest from institutional investors, coupled with the financial community’s increasing acceptance of cryptocurrencies in general, that has led one analyst to claim that the bitcoin price could hit $25,000 by the end of 2018.

The road to $25,000

Thomas Lee, co-founder and head of research at Fundstrat, is the man behind this forecast. He believes that the recent downturn in the bitcoin price can be blamed on tax selling. Specifically, Mr Lee believes that US investors owed a total of $25bn in taxes on bitcoin gains, and selling to meet these liabilities before the end of the tax season in April has depressed the price.

And now that the selling is over, the price is free to run higher according to Fundstrat’s analysis. The team of analysts at the research outfit believe that sentiment towards the cryptocurrency is currently at a level not seen since 2014. Its proprietary “bitcoin misery index” suggests sentiment towards the asset is so depressed it is now a contrarian trade.

Time to buy?

Despite the bullish forecast from Mr Lee and team, personally, I can’t bring myself to buy bitcoin. This is an asset I don’t really understand, and while I believe that the blockchain technology underpinning it could be a revolutionary development, I’d rather invest in companies that are developing this technology rather than bitcoin itself. 

Also, I am concerned about the ever-increasing number of hack attacks against bitcoin accounts, and I’m not sure I’m happy investing my money in any platforms around at the moment.

That said, this is my personal opinion, and other investors may be more comfortable with the level of security offered by some platforms, as well as bitcoin’s potential.

So overall, yes there is a chance that the price could hit $25,000 by the end of 2018. Some estimates even suggest that the currency could rise in value to be worth $50,000 by the end of the year. However, this asset is only really suitable for those investors who know a lot about the subject matter and who are willing to take on the extra risks associated with ownership.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

Rupert Hargreaves owns no share mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.