The first and largest cryptocurrency, Bitcoin (BTC) saw its price push to new record highs of $45,000 today when the electric car maker, Tesla announced its purchase of $1.5 billion worth of Bitcoin. DOGE the native cryptocurrency of Dogecoin also received a boost, thanks to fresh endorsements from rapper Snoop Dogg, Kiss’ Gene Simmons, and Elon Musk, surging to intraday highs of $0.0900 in the process.
The ‘Tesla-musk effect’ sparked up Bitcoin price again when the carmaker revealed its plans of offering its customers the option of buying products with BTC. This may imply Tesla adding BTC to its reserve instead of converting BTC payments to fiat upon receipt.
In an earlier interview, Elon Musk, the world’s richest man confirmed that he was a Bitcoin “supporter.” Mexico’s third-richest person Ricardo Salinas Pliego also added the hashtag Bitcoin to his Twitter bio while Hedge fund legend Bill Miller displayed support for Bitcoin (BTC).
BTC/USD Daily Chart
Bitcoin trades presently at $45,000.
Dogecoin (DOGE) has been on a massive pump-and-dump spree spurred on by r/Wallstreetbets inspired by Elon Musk’s tweets, surging to highs of $0.1 on Jan 29. Earlier the Tesla CEO said it would be entertaining if DOGE became “the currency of Earth in the future while adding, “Occasionally I make jokes about Dogecoin, but they are meant to be jokes. Dogecoin was made as a joke to make fun of crypto, but fate loves irony.”
In yet another tweet on Monday, Elon Musk moved the DOGE market when he said:
“Doge appears to be inflationary, but is not meaningfully so (fixed # of coins per unit time), whereas BTC is arguably deflationary to a fault,”
“Transaction speed of Doge should ideally be a few orders of magnitude faster.”
Here’s How Analysts React
Tesla is spearheading Bitcoin adoption at a crucial time in the bull market. Given Elon Musk’s propensity to move markets, Tesla’s newfound Bitcoin exposure could hasten retail adoption in the short term.
Many analysts opine that Tesla’s Bitcoin adoption news validated the cryptocurrency’s $50,000 price target in the short-term. Mike McGlone, the senior commodity strategist at Bloomberg stated:
“Tesla may be [the] catalyst to get Bitcoin market cap to $1Trillion. The firm’s disclosure that it’s investing in Bitcoin and accepting the cryptocurrency for payment is a stepping stone similar to onboarding by PayPal in October, which points to about $50,000 as the next resistance.”
Alex Krüger, an economist cum cryptoanalyst sees BTC trading next at $50,000. Guy Hirsch of eToro trading earlier stated that Bitcoin may trade in the range between $52,000 and $56,000 in the coming months based on data from the options market.
Bitcoin is right on track in its post halving performance, stated stock to flow creator PlanB who puts Bitcoin price by December 2021 at $100,000.
Factoring in halving-based predictions, renowned commentator Bitcoin Archive based on Ecoinometrics data devised a $90,000 BTC price target latest may 2021, stating that Bitcoin mimics 2017 post-halving behavior, but “much higher.”
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