By: Spencer Israel
Flashback to November 23, 2017—Thanksgiving.
Bitcoin had recently topped $8,000 for the first time and was already gaining a lot of media attention. By that point, it had risen $7,000 for the year, its 750% gain crushing every other asset.
Presumably, Bitcoin and cryptocurrencies were a hot topic at Thanksgiving tables across the country that year.
We can assume this because in the three weeks after the holiday, Bitcoin rose another $11,000 to its current all-time high of $19,793. And it wasn’t just Bitcoin—other cryptos experienced huge rallies as well. Ethereum rose from $400 on Thanksgiving to $1,400 on January 13. XRP rose from $0.24 to nearly $4 on January 4. And Litecoin ran from $71 to $364 in just three weeks.
Of course, the bubbly swiftly burst, and each crypto subsequently came crashing down to earth.
Fast forward to today, and crypto is once again breaking out. Bitcoin is up 175% this year, and a new all-time high (based on price) appears in sight. Not to be outdone, Ethereum is up 366% to its highest price since January 2018.
And this is to say nothing of the “crypto stocks”—i.e. names like Square, Riot Blockchain, and Marathon Patent Group (the latter two, it should be noted, remain highly speculative) that have rallied sharply because the company has some exposure to crypto or blockchain technology.
These moves feel familiar, but we haven’t quite reached late-2017/early 2018 levels of hype just yet, and the hype machine may never get that crazy again. However, in the three years since the initial crypto bubble burst, the fundamental case for crypto as an asset class hasn’t really changed, even as the use cases remain relatively limited.
Central bankers have taken notice. European Central Bank President Christine Lagarde recently told a panel “If it’s cheaper, faster, more secure for the users then we should explore it.” Jerome Powell has also said the Fed will review cryptocurrency uses in monetary policy.
And Ark Invest CEO Cathie Wood, whose ETFs have been among the hottest on Wall Street this year thanks to investments in emerging tech stocks Tesla, said she thinks Bitcoin could reach $400,000-$500,000.
Will Thanksgiving 2020 catalyze Bitcoin just as it did in 2017? Maybe the FOMO effect won’t be as strong, with most of us celebrating in small groups, if together at all, this year.
But a post-holiday rally in Bitcoin to $30,000 or beyond would not be the most unlikely thing to happen in 2020.
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