Will Bitcoin cross Rs 50 lakh mark?

Mumbai : Bitcoin has crossed Rs 17 lakh mark and if experts are to be believed, then it may be in the range of Rs 50,00,000 and Rs 1 crore in the year 2021.

Bitcoin has performed 200 per cent year to date (YTD), with other top crypto currencies like Ethereum performing well. On fundamental level, Bitcoin's growth is largely attributed to how it is designed and in May 2020, we witnessed third halving, a supply shock event, where the number of daily mined Bitcoin gets cut in half.

In the previous two halvings, Bitcoin and overall crypto market cap has risen exponentially, and we are witnessing a start of similar bull trend.

Bitcoin is emerging as an alternative investment class just like the precious metals, stocks in sectors less volatile. People have a tendency to convert the cash available, to avoid inflation, but bitcoin has not just avoided that, but created profits for such investors. There is a growing sentiment to hold less cash and hedge it in the market swings given the current societal and economic conditions.

"Bitcoin breaking above $23,000 is a milestone in a year which saw numerous ups and downs in the global economy. This is mainly due to numerous global renowned investors, institutions putting their weight behind Bitcoin," says Sumit Gupta, CEO and co-founder of CoinDCX.

The earlier skepticism has now been replaced by wide-spread acceptance and acknowledgment of Bitcoin as a strong investment option, he added. More importantly, this time around, we are witnessing Bitcoin demand not only from retail but more from global institutional investors. MicroStrategy has included Bitcoin in their company's treasuries.

Many payment rails like PayPal, Square are integrating crypto currencies in their services due to rising demand for crypto currencies from retail investors.

Recently, MassMutual, an insurance giant, made its way into Bitcoin investments. Additionally, Alan Howard, a billionaire hedge fund manager, is among the backers of a new institutional-focused investment firm, called One River Asset Management, that's eyeing as much as $1 billion allocation to Bitcoin.

In short-term (for the year 2021) the price range could be between Rs 50 lakh - Rs 1 crore owing to, the Bitcoin halving and growing global institutional demand, as mentioned earlier, he added.