Bitcoin Is Now Less Risky Than Dow, According to Bloomberg’s Mike McGlone
Bloomberg’s senior commodity strategist Mike McGlone notes that Bitcoin, the world’s largest cryptocurrency, has become less risky than the Dow in his Crypto Outlook report for February.
Our graphic depicts a prime indicator for the Bitcoin-to-Dow price ratio to extend beyond 1-to-1: volatility on the crypto appears to be in early recovery days after dipping below parity vs. the index.
The analyst believes Bitcoin’s fixed supply and the asset’s gradual maturation will be the main drivers behind its declining volatility. By the next reward halving, which is expected to take place in 2024, the volatility of the largest cryptocurrency could match that of gold:
It would be naïve not to expect bumps in the road with the new technology, but unless human advancement, electrification and digitalization backpedal, Bitcoin is poised to eventually become a worthy substitute for gold in investment portfolios.
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As reported by U.Today, McGlone recently predicted that Bitcoin could race ahead of the Dow in 2021, replicating the scenario with tech-heavy Nasdaq in 2020.
The “extreme downside” level
McGlone attributes Bitcoin’s ascent to $40,000 to “a rising tide” of institutional investors adopting the cryptocurrency.
He now views $20,000 as the “extreme downside” level that would only be revisited in case of a black swan event akin to the crash of global markets in March 2020.
Overall, the analyst is convinced that Bitcoin is currently in a consolidating bull market, and $50,000 is on the cards.
Yuri Molchan$1,000 is new support for Ethereum
Speaking of Ethereum, McGlone believes that the second-largest cryptocurrency has found solid support above the $1,000 level.
Earlier today, Ether soared above $1,600 for the first time after another explosive move.
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