- The analyst believes that Bitcoin will leave behind the fear of Omicron spread as investors begin to focus on larger issues of inflation.
- Thus, large investors will continue to pour money into BTC and other crypto-assets as an inflation shield.
After a major bloodbath on Black Friday last week, Bitcoin and the overall crypto market have bounced back. As of press time, Bitcoin (BTC) is trading 6.19 percent up at a price of $57,415 with a market cap of $1.084 trillion. It looks like the recent BTC price bounceback comes from a recent support trendline.
— Lark Davis (@TheCryptoLark) November 29, 2021
The fast spread of the new COVID-19 variant – Omicron – had rattled the market while sending the global market on a tailspin. First discovered in South Africa, the new variant is spreading fast in different parts of Europe.
Some market analysts feel that could be the right time to buy Bitcoin. Commenting on the recent bounceback, deVere Group chief executive Nigel Green said:
Bitcoin is unstoppable, and I fully expect to see prices double over the next 12 months. This dip in cryptocurrencies – which are, of course, the inevitable future of money – will be used by savvy investors as a major buying opportunity, topping up their portfolios with the current lower entry points.
Bitcoin has gone mainstream
As said, the news about the spread of the Omicron COVID-19 variant rattles the global markets and Bitcoin followed it thereafter. Green says that this is a clear sign of Bitcoin’s mainstream adoption. He added:
The discovery of a new COVID variant has rattled global stock markets as it brings in a new wave of uncertainty, which they hate. The crypto markets have mirrored the reaction of other financial markets. This underscores how mainstream digital assets have now become, as an increasing number of institutional investors have piled into Bitcoin this year.
However, Bitcoin is seen as a store-of-value and a replacement for Gold. Thus, the BTC price collapsing along with the stock market doesn’t make sense. But historically the crypto market has initially followed the stock markets even during the March 2020 crash.
“I think this [is]a knee-jerk reaction from the crypto market. It will move on from this relatively quickly as it did with the Delta variant in the summer. Why? Partly, because now we have more of a roadmap of how to deal with variants. But importantly because amongst retail investors, it is increasingly regarded as a safe haven asset, similar to gold,” added Green.
Bitcoin will act as an inflation shield
Adding further, Green stated that the concerns around Omicron spread shall be short-lived. He believes that the retail investors will soon focus on other rising concerns of inflation. Thus, he expects crypto to perform well over the next year.
Investors will once again focus on heightening global inflation fears caused by lingering supply-side issues. As such, amid some peaks and troughs along the way as markets never move in a straight line with traders taking profit, we can expect to see the price of Bitcoin and other major cryptocurrencies continue their upwards trajectory.
Bitcoin has served as a good hedge against inflation due to its limited supply. Green believes that greater inflation fears will spike Bitcoin demand from large investors. Thus, more liquidity will come to the Bitcoin market. “This ‘inflation shield’ will continue to bring to the crypto market growing investment from major institutional investors, bringing with them capital, expertise and reputational pull – and further driving up prices,” added Green.