Bitcoin and other digital currencies rose on Friday as the mood in the broader markets improved thanks to the strong performance of tech firms. This is a positive sign for crypto investors—but not as optimistic as a new forecast for Bitcoin from ARK Investment Management, led by the famous Bitcoin supporter and tech visionary Cathie Wood.
Bitcoin increased by 2.5% in the last 24 hours, reaching $43,150. It stayed close to its highest level in two weeks and above the $40,000 mark. However, it is still lower than its peak of over $48,000, which hit last month when the U.S. approved the first Bitcoin exchange-traded funds (ETFs).
Phillip Shoemaker, the executive director of blockchain group Identity.com, said that Bitcoin is in a “consolidation phase” after the excitement and volatility caused by the new ETFs. He said these ETFs have drawn much attention and money to Bitcoin. He added that this will benefit Bitcoin in the long run and reduce some price swings.
Cryptos have followed the upward trend of the Dow Jones Industrial Average and the S&P 500 in the stock market this week as investors felt more optimistic. They were impressed by tech companies’ good results and expected interest rates to drop significantly this year.
Bitcoin also got a boost this week from a bold prediction by ARK Investment Management, the firm run by Cathie Wood, a big fan of Bitcoin and tech innovation.
ARK analyzed different assets, such as Bitcoin, gold, and stocks, based on how much return they gave for the risk they were involved in the last five years. They wanted to find the best way to invest money to get the most return for the least risk. ARK found that investing 19.4% of the money in Bitcoin was the best way. They then imagined what would happen if the whole world did the same thing with the $250 trillion available for investment—an improbable scenario, to be honest. ARK estimated that this would increase Bitcoin’s price to $2.3 million. That is a very high price for Bitcoin.
Besides Bitcoin, Ether, the second-biggest crypto, also increased by 2.5% and reached $2,320. More minor digital currencies or altcoins also did well, with Cardano rising by 6% and Polygon by 4%. Memecoins, based on jokes or memes, did not change much, with Dogecoin and ShibaInu increasing by 2%.
