Brian Kelly, CEO of digital asset investment firm BKCM, recently hosted a session on CNBC’s program Futures Now. During the interview he talked about the fundamentals of Bitcoin, institutional interest in crypto and what he sees as the next price target for Bitcoin.
Bitcoin’s Next Move
Fresh on the heels of a move from $4,000 to $5,000, Brian Kelly predicted that, “probably a reasonable target is close to $6,000 for this move.” He landed on six-thousand because Kelly believes it to be the fair value of Bitcoin at this time.
Although measuring the “fair value” of Bitcoin is impossible, there exist a number of metrics that attempt to do just that. They diverge on main points however most agree that when Bitcoin enters a bull market it becomes significantly overvalued. During the next bull run it’s possible to imagine Bitcoin having a fair value of $10,000 but being valued at $100,000.
All of this is to say that while Kelly’s call may be on point and we might see $6,000 Bitcoin soon, only a small percentage of the time is Bitcoin valued fairly. Most of the time it is over or undervalued.
When asked about the market’s perception of Bitcoin, Kelly claimed, “I do think the sentiment has shifted here. All indications that we have, whether it be fundamentals, technical, quantitative analysis that we do, all suggest that we probably have at least started to put in the bottoming process. If you look back at patterns of past cycles it looks very similar to this. You have that kind of one last flush out and then the market starts to trade higher.”
From the tone of the interview it sounded like Kelly believes that last flush out has already happened and from here on out prices are going to rise. Listing reasons for the rise Kelly stated, “it’s happening on improving fundamentals and improving institutional sentiment.”
Kelly is in a better position than most to judge the level of interest in cryptocurrencies from large institutions and he claims that the news is positive.
“You’re starting to see a fair amount of institutional interest in this space. By institutional I mean even high net worth individuals, family offices, are starting to take a serious interest. There are a couple of major brokerage firms that are rolling out some custody solutions. So there’s quite a bit going on under the surface that you know just kind of mechanically could have the same impact as an ETF.”
Kelly’s answer came in response to a question about a Bitcoin ETF. While Kelly said he doesn’t expect to see an ETF passed until 2020, he doesn’t believe it matters that much at this point. People are investing in Bitcoin, interest is growing and it’s happening without Wallstreet’s help.
Hopefully that continues to be the case and by the time an ETF does get passed there are so many things happening in crypto that it’s like throwing fuel on an already massive fire.
Image Credits: “CNBC”