• Bank of America outlines the benefits of adopting Bitcoin as legal tender in El Salvador, suggesting a bullish outlook on the leading cryptocurrency.
  • Bitcoin is decoupling with gold, correlation turns negative as the bellwether cryptocurrency rallies.
  • Bitcoin mining difficulty is up 7.3%, marking the first significant increase since the hashrate migration.

Bitcoin nearly reversed the inflows to exchanges during the May sell-off with peak outflows. The asset has rebounded strongly and is ready for a breakout. 

S2F creator Plan B confirms bullish prediction for BTC, says bull market is not over

The Stock to Flow model (S2F) proposed by Plan B essentially compares BTC to scarce commodities like gold or silver. The model advocates that Bitcoin is a scarce resource and they should retain their value in the long term, with relative scarcity and low supply. 

Proponents and analysts criticized S2F for the past four weeks as BTC deviated from the predicted price. In the second leg of the bullrun that appears to have started in the past week, BTC is no longer rangebound. 

The largest cryptocurrency by market capitalization is back above the $46,000 level, and Plan B has confirmed his bullish prediction for BTC. In a recent interview, the creator of S2F said, 

The Bitcoin bull market is not over, and we will see $100,000 till Christmas.

Experts agree with Plan B’s prediction for BTC price. Nikolay Shkilev, Co-founder and CEO of Zelwin ecosystem, recently shared a new target for Bitcoin based on his analysis. Shkilev tweeted:

Increasing adoption is likely to drive the asset’s demand and fuel the narrative of BTC hitting $100,000 by the end of 2021. A report published by Bank of America in July 2021 highlights the pros of accepting Bitcoin as legal tender in El Salvador.

Using Bitcoin for remittances could potentially reduce transaction costs compared to traditional remittance channels.

The bank sees merit in the Foreign Direct Investment (FDI) that Bitcoin brings to El Salvador. However, the problem of volatility when BTC is converted to fiat remains at large. 

With the ongoing BTC price rally, it is clear that the decoupling from gold is bullish for Bitcoin.      

Another factor influencing the price trend is the great western hashrate migration (the shift of BTC mining farms from China to the West) that was followed by negative adjustments in mining difficulty. The most recent increase of 7.3% marks the first significant shift since the migration. 

Bitcoin’s current hash rate and decoupling from gold mark the beginning of the second leg of the BTC bullrun with a target of $92,000.

 


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Solana and XRP ETFs may be on the cards in 2025, Standard Chartered analyst says

Solana and XRP ETFs may be on the cards in 2025, Standard Chartered analyst says

Ethereum Exchange Traded Fund approval news has renewed optimism on Solana and XRP ETFs approval in 2025. Analysts at Standard Chartered believe more cryptocurrency ETFs may be approved next year, and these assets will not be classified as securities. 

More Solana News

Uniswap Price Forecast: UNI could be poised for 30% rally after month-long lull

Uniswap Price Forecast: UNI could be poised for 30% rally after month-long lull

Uniswap price has broken out of a 35-day consolidation this week, a sign of a possible rally ahead that could increase the token’s price around 30%. Technical indicators support the bullish thesis, while on-chain data also aligns with it.

More Uniswap News

Dogecoin inspiration Kabosu dies, leaving legacy of $22.86 billion market cap meme coin behind

Dogecoin inspiration Kabosu dies, leaving legacy of $22.86 billion market cap meme coin behind

Kabosu, the popular Shiba Inu dog that inspired the logo of the largest meme coin by market capitalization, Dogecoin, died early on Friday after losing her fight to leukemia and liver disease. Kabosu had gained popularity as the dog behind the viral “doge” meme. 

More Dogecoin News

XRP climbs past $0.53, SEC Chair Gensler says the agency has done very well in court cases

XRP climbs past $0.53, SEC Chair Gensler says the agency has done very well in court cases

Ripple lawsuit ruling is expected soon, following the new US crypto bill, FIT21. SEC Chair Gary Gensler says the agency has fared well in legal battles while speaking at the ICI 2024 Leadership Summit. 

More Ripple News

Bitcoin: BTC struggles, but $80K is at striking distance Premium

Bitcoin: BTC struggles, but $80K is at striking distance

Bitcoin (BTC) price is in a good position to resume the bull rally despite the recent struggle. Optimism will restart if BTC overcomes a critical hurdle and flips it into a foothold. In such a case, the pioneer crypto will be slated to push to a new all-time high (ATH). 

Read full analysis

BTC

ETH

XRP