A recent article from Forbes suggests that “crypto FOMO” may soon increase drastically. Growing FOMO, or “Fear-Of-Missing-Out”, is generally said to lead to wild price increases. Moreover, this Forbes report also argues that this price increase could be more sustained than in late 2017.
Is massive crypto FOMO about to hit?
This Forbes piece starts of by recounting how Bitcoin has had a strong rise so far this year. As those watching Bitcoin will know, Bitcoin has already risen from around $3,800 to $10,000 this year. At the time of writing, Bitcoin is currently trading at $10,367.
This Forbes article, written by Chris Kline, nonetheless says that Bitcoin could reach even higher this year. One of Kline’s main arguments is that the rise in the price of Bitcoin seen this year holds actual merit.
However, some might complain over an excessive focus on the price of Bitcoin when predicting the wider crypto sector. Although this criticism can be understood, Bitcoin has so far been a helpful indicator of the crypto industry’s performance.
Compared to Bitcoin’s highly publicized and explosive rise to around $20,000 back in 2017, the crypto industry has now reportedly seen “real product development”. What’s more, Kline also says that customers’ relative ignorance of crypto may “slingshot prices upward” as crypto FOMO sets in.
While hype and consumer interest may have driven Bitcoin’s first rise past $20,000, consumers are currently showing relatively little interest. However, behind the scenes, institutional demand for crypto is rising rapidly.
Large actors may be causing crypto FOMO
In addition to this, large actors are currently moving into place to fully embrace crypto. Perhaps notably, Facebook is moving ahead with its “Libra” crypto. Moreover, many observers believe that Facebook will tackle regulatory hurdles for the wider crypto industry in doing this.
This could also give crypto as a whole even more public exposure. This, in turn, could dramatically boost crypto investment appetite.
According to the Chief Investment Officer of the Arca hedge fund, Jeff Dorman, who was quoted in the Forbes piece, this could truly introduce Bitcoin to the masses. “It [Libra] immediately introduces two billion people to digital wallets,” Dorman said.
Furthermore, Dorman is not the only one with this view. According to Cole Walton, the head trader at Kanos Capital Management, Libra “will be the biggest on-ramp into crypto we have seen yet, and institutional money knows this.”
In addition to this, Kline also argues that growing crypto FOMO could shift money from gold towards crypto. If true, this could lead to a massive asset class shift as gold has an implied market cap of $7 trillion. This compares to Bitcoin’s market cap of around $180 billion.
If one would presume that crypto FOMO transfers the entire gold market cap to Bitcoin, this would result in a Bitcoin price of roughly $194,000.
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Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.