CNBC analyst Brian Kelly has again reaffirmed his view that Bitcoin is heading for new all-time highs.
Talking on CNBC’s Fast Money, the founder and CEO of crypto investment firm BKCM thinks a price breakout above the 2017 highs of $20,000 will happen over the next couple of years.
— CNBC's Fast Money (@CNBCFastMoney) April 10, 2019
He said: “This next cycle, you’re talking probably a two-year cycle. In 2020, the supply of Bitcoin is going to get cut in half. The cycle for Bitcoin is usually about a year before to a year after. So over this two-year period, you will likely get this big upswing, particularly if the institutions come in, and I think we surpass all-time highs.”
Kelly points to Bitcoin wallet activity and institutional investors as two key indicators that show Bitcoin may have already hit its most recent low of $3,100 at the tail end of 2018.
“I think there’s a really good chance that the December lows we saw in the $3,000s are probably the low for this cycle. There are a couple of things that are going on,” he said.
Looking at the data
Kelly added: “You’ve seen improving fundamentals. You look at active addresses. That’s one of the big metrics I look at. That’s up 26% from the January lows. You look at transaction levels. Those are back to 2017 levels, so there’s a lot of network activity.”
The statistics do support the argument Kelly is trying to make. Other all-time highs have also been seen in the trading market recently, with nominal crypto trading volume (think the number of BTC or ETH traded each day and not just the USD value) currently at an all-time high with close to half a million BTC in open interest being traded on the go-to high-margin exchange BitMEX.
Kelly then turned to the institutional outlook for the decentralised asset class, saying: “You’re seeing people like Fidelity still rolling out their institutional platform. And then, as a proxy, look at the CME Bitcoin futures. The large open interest holders.
“These are big institutions that are at all-time highs. And it continues to grow. Last week they saw record volume on CME Bitcoin futures. So you’re starting to see institutional investors come in here with a good fundamental tailwind. And that’s got Bitcoin back in the saddle again.”