Fidelity Investments’ global macro director Jurrien Timmer says that for Bitcoin (BTC) to hit fresh all-time highs (ATHs) one key event must occur.
Timmer tells his 186,600 followers on the social media platform X that Bitcoin adoption may need to increase before the crypto king can print new ATHs.
“The growth of Bitcoin’s network has slowed in recent months, while its price has continued to gain. In my view, this divergence between price and adoption could explain why Bitcoin has slowed down a bit along its path to potential new all-time highs. The pendulum will only swing so far. For the new highs to continue, the network may have to accelerate again. Could this be driven by the next chapter in the fiscal dominance thesis (i.e., monetary subordination)?”
The analyst also says that he believes Bitcoin is competitive to gold as a store of value and that the growth of Bitcoin’s price is also driven by its scarcity and central bank monetary policy.
“In my view, Bitcoin is exponential gold and an aspiring player on the store of value team. My work suggests that the price of Bitcoin is driven primarily by the growth in its network, which is in turn driven by Bitcoin’s unique scarcity feature, as well as the monetary and fiscal policy cycle, and of course sentiment.”
The analyst believes that Bitcoin’s adoption curve remains on track, based on the growth of non-zero addresses, but needs to uptick for price to start rising.
“The chart below shows Bitcoin’s growing network along a simple power curve. The number of non-zero addresses has converged towards this power curve, with Bitcoin’s price oscillating around it like a pendulum. Such is Bitcoin’s unique series of boom-bust cycles.”
Bitcoin is trading for $66,676 at time of writing, down slightly in the last 24 hours.
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