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Why the Bitcoin Price Could Take a Very Long Time to Reach New Highs | ccn

The involvement of major financial institutions in the likes of Fidelity and Goldman Sachs have led to some improvements in the institutional sector of Bitcoin. However, considering that over $50 billion could be needed to fuel a rally for BTC from a low price range to the $20,000 region and the fact that BTC recovers at a slower rate every time a major correction occurs, a longer recovery period than many investors expect may take place.

“True, BTC has endured multiple 80%+ corrections and recovered massively after that, which is impressive. There is a good chance it will do the same this time as well. But. It gets harder and harder with every new correction,” Hristov said, adding that institutional investors could fuel a large rally, but it is not sufficient.

“Could these investors put $50bn in the market. Maybe. But it may not be enough though to go to a new high.”

The problem is that despite the involvement of Fidelity, these custodians and OTC markets are relatively new and they do not have a long track record. One variable is that institutions may see a long-term opportunity given the plunge in value that Bitcoin recorded over the past year.

Infrastructure Has to Strengthen
Institutions, as retail investors did in 2017, could suddenly initiate a FOMO (fear of missing out)-like trend in the months to come. But, the asset class has already matured to a certain extent, and as time passes, the probability of an unforeseen massive surge in price could gradually decline.

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Why the Bitcoin Price Could Take a Very Long Time to Reach New Highs.