Bitcoin price rises sharply and can record price gains. The picture shows a price curve as well as stacked bitcoins.
Bitcoin is the first and most important cryptocurrency of all. In addition, BTC has a market dominance of around 60% according to Coinmarketcap and is therefore by far the most valuable crypto currency on the market. Still, many still consider Bitcoin Code to be undervalued. So does the Bloomberg analyst Mike McGlone. In his opinion, the Bitcoin price should currently be much higher. He uses an on-chain indicator as a basis for argumentation.
Bitcoin undervalued, according to Bloomberg Analyst
According to Mike McGlone, Bitcoin is currently priced at USD 15,000. Accordingly, the current BTC price of around USD 10,500 would be around USD 4,500 undervalued. This assumption is based on a combination of recent price movements, the hashrate and the average of active Bitcoin addresses.
The Bitcoin hashrate continues to rise and recently hit new highs. The addresses used are also increasing. The 30-day average of Bitcoin addresses is a top metric for adoption and equates to the price of $ 15,000 when measured on an auto-scale basis since 2017.
The recent Bitcoin price slump did not unsettle McGlone. he continues to believe that BTC is hopeful for both trading and investment purposes. He assumes that Bitcoin will remain the most important cryptocurrency and will be the most important element of the “paradigm shift towards digital money and store of value”.
On-chain metrics indicate a positive trend
Nevertheless, he says that there can also be strong price fluctuations. But for Bitcoin to lose value in the long term, the two on-chain metrics – hashrate and active addresses – would have to change significantly in a negative direction. Therefore, he currently sees a positive trend, which is supported by these factors.
Our graphic shows primary on-chain metrics that would have to reverse in order for Bitcoin to stop rising in price – the hashrate and active addresses.
Bitcoin is becoming more and more relevant
You can also clearly see the development of the last few months and years. Bitcoin is no longer the means of payment for criminals and drug dealers, as it was spread through the media a few years ago. It is slowly becoming a recognized financial product and is now enjoying demand from various institutional investors.
In addition, the infrastructures around Bitcoin are getting better and better. Onboarding prospects has never been easier. Soon, BTC will also find a place in the portfolios that banks are offering their customers. But a much more important reason why Bitcoin should rise in price in the long term is the regular halvings that sustainably reduce the production rate of new BTC.
The last Bitcoin Halving took place in May this year. The effects on the market only become apparent on average about 18 months later. At least if you include the findings from the other two halvings. Accordingly, a supply shock could hit us next year, which could have a positive effect on the price.
The next halving will take place in 2024 and will make Bitcoin rarer and harder than gold. So BTC would be the best store of value in theory. Whether the understanding of Bitcoin will be given by then is in the stars. We are excited and will keep you up to date as always.
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