10 Biggest Bitcoin Predictions in 2021

Published on June 9, 2021 at 4:48 pm by Usman Kabir in Hedge Funds, Lists, News

In this article we discuss the 10 biggest Bitcoin predictions in 2021.

Bitcoin, the most popular cryptocurrency, has fallen by close to half in value from a peak of around $64,000 since April, resulting in social media speculation around crypto-related stocks in general and the future of blockchain technology in particular. Some of these concerns have come amid a renewed government crackdown against digital currencies in China, one of the most important internet markets in the world. However, financial experts have stepped in to fill some of the information gaps and soothe investor concerns on the issue.

Crypto-related offerings, by the very nature of a business still in infancy, are volatile. Smart investors realize this, and often understand why a dramatic fall in value for a technology that is universally considered revolutionary might actually represent a buying opportunity, instead of a panicked selloff. Another solid indicator of long-term outlook on crypto is hedge fund interest, and many of the top performing funds over the past twelve months, including ARK Investment and Bridgewater Associates, hold crypto-related assets.

There has also been a lot of buzz around the energy usage of Bitcoin mining, with Tesla, Inc. (NASDAQ: TSLA) chief Elon Musk leading the pack in this regard. Some finance experts also think that Ethereum, the second most popular coin, could overtake Bitcoin in value eventually. The consensus, however, remains that Bitcoin has a brand value that extends far beyond other coins, and a history going back over a decade that lends further credibility to it when compared against coins that were just released a few years ago.

Some Bitcoin competitors actually started out as a joke and experts argue that coins like these help in improving the overall credibility of Bitcoin. Dogecoin, for example, started out as a prank but has now become one of the best-performing cryptocurrencies in 2021, due in part to the social media antics of Tesla, Inc. (NASDAQ: TSLA) chief Musk, up more than 10,000% at a peak year-to-date value before pulling back by over 30% since. A couple of more serious contenders to the Bitcoin throne are Ethereum and Ripple, two blockchain-based currencies that offer advantages over Bitcoin when processing transactions.

Companies like PayPal Holdings, Inc. (NASDAQ: PYPL) and Twitter, Inc. (NYSE: TWTR) have taken advantage of this competition between coins and set standards for collaborations, thereby ensuring a level of quality in a space that is still unregulated and subject to frauds of various kinds. PayPal Holdings, Inc. (NASDAQ: PYPL) and Twitter, Inc. (NYSE: TWTR) have global outreach and their actions have consequences for blockchain in not only the US but in hundreds of countries across the world.

The fiscal year is far from over and Bitcoin still has a lot of room to run before investors would need to reconsider the overall situation. However, despite recent setbacks, it is evident that cryptocurrencies, and Bitcoin in particular, have transformed finance for years to come. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

Stan Druckenmiller

With this context in mind, here is our list of the 10 biggest cryptocurrency predictions in 2021.

Biggest Bitcoin Predictions in 2021

10. David Solomon, CEO Goldman Sachs

Prediction: Big Evolution is Coming to Bitcoin Regulation

David Solomon is the chief executive officer of The Goldman Sachs Group, Inc. (NYSE: GS), a New York-based investment bank and financial services company. The bank earlier this year reopened a cryptocurrency trading desk and started offering clients exposure to crypto investments. Solomon touched on Bitcoin in an interview with CNBC in April.

Solomon was of the view that there was a big evolution underway in the world of Bitcoin and other digital currencies, primarily related to the regulations surrounding the involvement of established financial institutions in blockchain technology. Solomon said that The Goldman Sachs Group, Inc. (NYSE: GS) was keeping a close on crypto as the situation developed.

When asked about whether the bank was actively lobbying for rule changes in this regard, Solomon said that the space was still evolving and The Goldman Sachs Group, Inc. (NYSE: GS) was trying to be responsive to clients. However, Solomon reiterated that there were still significant restrictions around the bank acting as a principle around Bitcoin.

Just like Tesla, Inc. (NASDAQ: TSLA), PayPal Holdings, Inc. (NASDAQ: PYPL), and Twitter, Inc. (NYSE: TWTR), The Goldman Sachs Group, Inc. (NYSE: GS) is one of the best crypto stocks according to the 10 biggest Bitcoin predictions in 2021.

9. Jack Dorsey, CEO Square

Prediction: Bitcoin Protects Against Currency Devaluation

Jack Dorsey is the chief executive officer of Square, Inc. (NYSE: SQ), a California-based digital payments company with $400 million in crypto-related investments. Dorsey has been a long-time advocate of the wider adoption of digital currencies like Bitcoin, and attended a Bitcoin conference in Miami last week to reiterate his bullish view on the currency.

Dorsey told conference attendees that Bitcoin was the important thing to work on in his lifetime. The Square, Inc. (NYSE: SQ) CEO said Bitcoin has the potential to create a whole new financial infrastructure that would serve communities of all types. Dorsey recently partnered on a new Bitcoin endowment to help the development of the currency in India and Africa.

At the Miami conference, Dorsey, who has seen the stock of Square, Inc. (NYSE: SQ) fall in recent weeks amid a lull in the market around growth stocks in general, said that no single person or institution could stop the rise of Bitcoin. He also noted that Bitcoin was fast becoming a hedge against currency devaluations around the world.

Just like Tesla, Inc. (NASDAQ: TSLA), PayPal Holdings, Inc. (NASDAQ: PYPL), and Twitter, Inc. (NYSE: TWTR), Square, Inc. (NYSE: SQ) is one of the best crypto stocks according to the 10 biggest Bitcoin predictions in 2021.

8. Charlie Munger, Vice Chairman Berkshire Hathaway

Prediction: Bitcoin Success is Contradictory to Development of Civilization

Charlie Munger is the vice president of Berkshire Hathaway Inc. (NYSE: BRK-A), the Nebraska-based holding company with core interests in the insurance industry but stakes in several large consumer staples corporations as well. Munger is the second-in-command to Warren Buffett, perhaps the most successful long-term investor on Wall Street in modern history.

Although Berkshire Hathaway Inc. (NYSE: BRK-A) has a diverse portfolio, Munger and Buffett have avoided dabbling into digital currencies. At an annual shareholder meeting earlier this year, Munger was asked to comment on the meteoric rise of Bitcoin and whether his company had made a mistake by not jumping on the crypto bandwagon.

Answering the question, the vice president of Berkshire Hathaway Inc. (NYSE: BRK-A) did not hold back in expressing his views on the matter, saying that he considered the success of Bitcoin to be disgusting and an affront to civilisation. He also said that he was skeptical of financial products like Bitcoin that someone had produced out of thin air.

7. Michael Novogratz, CEO Galaxy Investment Partners

Prediction: Bitcoin Pullback is a Buying Opportunity

Michael Novogratz is the chief of Galaxy Investment Partners and former partner at Fortress Investment Group LLC. He belongs to a small group of hedge fund managers who have been pushing crypto-related investments to clients, dismissing concerns around volatility and regulations by touting the explosive potential of the product.

In a recent interview with business news platform CNBC, aired on May 18, Novogratz appeared to brush aside long-term speculation around Bitcoin, reiterating his bullish stance on the coin and saying that the fall in value actually represented a buying opportunity for investors, noting that despite recent setbacks, Bitcoin was still 50% up year-to-date.

While urging people with the means to go all out on Bitcoin, the hedge fund guru commented how the fall in value of the most popular cryptocurrency was actually just a test of investor confidence, detailing that markets were never supposed to be easy and that if they were easy, everyone on the planet would be as rich as they wanted to be.

6. Stanley Druckenmiller, Former President Duquesne Capital

Prediction: Very Tough to Unseat Bitcoin as Ultimate Store of Value Among Assets

Stanley Druckenmiller is the billionaire former president of Duquesne Capital, a hedge fund with one of the best track records on the market. He is an old-school investor who has made his name in the industry by working alongside George Soros, one of the most famous investors in the world today. Druckenmiller has not been the most vocal Bitcoin admirer in the recent past.

Stan Druckenmiller

But his views on Bitcoin have changed since he called the currency a solution in search of a problem a few years ago. In late May this year, he sat down for an interview with news publication The Hustle and was very candid about the evolution of his position on Bitcoin, even admitting that he felt like a moron for not buying Bitcoin as it was going up.

Expressing his views on the recent fall in value of Bitcoin and the idea that other coins like Ethereum could overtake Bitcoin, Druckenmiller explained why that was unlikely, saying that it would be tough to unseat Bitcoin as the ultimate store of value among assets because it had become brand, been around for a long time, and had a finite supply of tokens.

5. Anthony Scaramucci, Managing Partner Skybridge Capital

Prediction: Bitcoin Is Apex Predator in Digital Currencies Despite Altcoins

Anthony Scaramucci is a managing partner at Skybridge Capital, a New York-based global investment firm. He has also served as the communications adviser to former United States President Donald Trump. Scaramucci is bullish on Bitcoin despite the recent setbacks and speculation surrounding the future of crypto amid governmental crackdowns.

Last month, during an interview, Scaramucci said that Bitcoin was still the currency to own even as it struggled while alternate coins soared. Underlining the resistance he faced when he advised clients to invest in crypto a few years ago, Scaramucci said that Bitcoin was the only cryptocurrency that had managed to reach escape velocity.

Scaramucci added that the fall in value was an opportunity, urging investors not to miss out on it. He added that even with the growing prominence of altcoins, Bitcoin had been able to maintain supremacy as the apex predator in digital currencies. Scaramucci said he asked his clients to own small amounts of Bitcoin to get them to appreciate its value.

4. Ray Dalio, Former CIO Bridgewater Associates

Prediction: Bitcoin Better Than Bonds as a Savings Vehicle During Inflation

Ray Dalio is the former chief investment officer of Bridgewater Associates, the Connecticut-based investment firm that was the top performing hedge fund in 2020, reporting $46 billion in earnings through the year. Dalio recently sat down for an interview with New York-based crypto news site CoinDesk to talk about Bitcoin.

Dalio said that the United States dollar was on the verge of devaluation and that China was threatening the role of the dollar as the preferred reserve currency in the world. In such an environment, Dalio elaborated how Bitcoin could be a good savings vehicle and a hedge against inflation should things go from bad to worse.

Dalio also revealed that he owned some Bitcoin during the interview, saying he would prefer Bitcoin over bonds for savings in the present economic situation. The billionaire was bullish on the most popular cryptocurrency, saying that the greatest risk associated with Bitcoin was the success it looks set to achieve.

3. Paul Tudor Jones, CIO Tudor Investment Corp

Prediction: Sovereign Governments Will Eventually Use Own Version of Crypto

Paul Tudor Jones is the chief investment officer of Tudor Investment Corp, the Boston-based hedge fund that manages over $20 billion in assets. In a media interview late last year, Jones explained his position on Bitcoin, saying that the cryptocurrency was a crazy rocket ship that looked set to soar higher in the coming weeks and months.

Billionaire Paul Tudor Jones' top 10 stock picks

Jones told Yahoo Finance that he expected the price of Bitcoin to be significantly higher two decades from now. Despite the highs that the currency had touched over 2020, Jones said he believed that the price of Bitcoin was still wrong considering the possibilities it offered, comparing it to the dotcom boom in the late 1990s.

In an investor letter dated May 2020, Jones called Bitcoin the faster horse among cryptocurrencies and a solid bet against inflation. He was also bullish on the overall digitization of money as banks and governments took steps in that direction. Jones predicted that sovereign governments would eventually use their own versions of crypto.

2. Balaji Srinivasan, Former CTO Coinbase

Prediction: Firewall, Domestic Penalties Will Affect Blockchain in China

Balaji Srinivasan, is the former chief technology officer of Coinbase and an angel investor with significant exposure to a range of technology-related companies. Srinivasan is perhaps one of the most ardent Bitcoin bulls in the finance world, but is equally cautious about the threat of possible crackdowns against crypto as it challenges traditional power players.

Balaji Srinivasan

For example, Srinivasan predicted the recent crackdown on cryptocurrencies in China as far back as two months ago during an interview with The Tim Ferriss Show. Balaji explained how the Great Firewall of China would act against foreign influences on domestic internet operations, making crypto a prime target of the authorities sooner rather than later.

Srinivasan also warned of domestic penalties for those dealing in blockchain technologies in China. A couple of months after his interview, the Chinese government placed restrictions on the finance institutions dealing in cryptocurrencies like Bitcoin. Coin mining has already been banned in China.

1. Cathie Wood, CEO ARK Investment Management

Prediction: Bitcoin Will Reach $500,000

Cathie Wood is the chief executive officer of ARK Investment Management, the New York-based hedge fund renowned for investments in technology-related growth stocks with explosive potential. Wood owns stakes in several crypto-related firms, including Tesla, Inc. (NASDAQ: TSLA), the California-based electric vehicle maker.

Cathie Wood of ARK Investment Management

Wood, who has hundreds of millions invested in crypto, has publicly bashed Tesla, Inc. (NASDAQ: TSLA) chief Elon Musk recently for caving in to institutional pressure and questioning the energy-usage of coin mining farms, sending crypto-related stocks on a free-fall in April that looks set to continue over this quarter.

Wood made an appearance on Bloomberg TV in May to stress that Bitcoin would rise to $500,000 despite the recent fall in value. She highlighted that the adoption of solar energy in coin mining was accelerating dramatically and that Tesla, Inc. (NASDAQ: TSLA) chief Elon Musk would come back to be part of the crypto ecosystem soon.

You can also take a peek at Billionaire Stan Druckenmiller’s Top 10 Stock Picks and Billionaire Julian Robertson On Interest Rates and His Top Stock Picks For 2021.