Good Medium Term Outlook for Bitcoin, Says Bitfury CEO
Brian Brooks is bullish on bitcoin in the medium-term due to findings in a recent Goldman Sachs report.
Bitcoin rose by 500% between Nov. 2020 to March 2021 but dropped as low as $39,692 by 9:45 am Eastern Time on Jan. 10, 2021. “There are some things going on short-term that are a little bit negative for Bitcoin, but only short-term,” said Brian Brooks, CEO of Bitfury, and former Acting Comptroller of the Currency, in a recent interview with CNBC. Brooks went on to say, “The Fed is introducing some mild inflation strategy for 2022. Due to bitcoin’s potential as a hedge against inflation, there are going to be some modestly negative effects on price.” He refers to the Fed’s minutes from its most recent meeting, where it is evident that the bank is set to remove stimulus from the economy to combat rising prices.
Yuga Hasegawa of Bitbank opined in the wake of the Fed’s revelation that bitcoin could fall even further as the broader market digests the Fed’s announcement. The Fed is releasing a report on Wednesday, Jan. 12, 2021, illustrating how much inflation increased during the COVID-19 pandemic due to stimulus packages. This may cause a further bitcoin price drop.
Bitcoin took 20% of Gold’s market in 2021
Brooks is optimistic about bitcoin’s medium-term outlook. He brings up the recent Goldman Sachs report that augers well for bitcoin. According to the report, Bitcoin is 20% of the global store of value market, compared to gold. According to the report, Brooks says that bitcoin could hit $100K and achieve equal status with gold as a store of value. According to the report, Bitcoin returned 60% in 2021, followed by 55% for crude oil, and 29% for the S&P 500. Echoing Brooks’ sentiment, Mike Novogratz of Galaxy Digital said, “I’m not nervous in the medium-term, but we’re going to have a lot of volatility in the next few weeks.”
Of his own company’s viability in light of recent price action, Brooks said, “The profitability of bitcoin mining is only partly-related to bitcoin price. It’s about hash rate and who can grab the most market share.” Bitfury has inked partnerships with renewable energy providers. According to Brooks, Bitfury will have an Initial Public Offering (IPO) in the USA. When questioned on the link between bitcoin’s price and work being done in the Web 3.0 space, Brooks said, “There’s bitcoin, and then there’s everything else.” According to Brooks, most of the development work is being done on Ethereum, Solana, and Cardano.
Other reasons for price decline
According to Noelle Acheson of Genesis, a significant bitcoin selloff occurred through stop-losses set at $40K, and bitcoin found a support level at $40K. John Wu of Ava Labs was asked whether institutional investment would continue in bitcoin in the light of its decline. “The smart money will follow where the money is, which is in Web 3.0,” said Wu.
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