If bitcoin mirrors the path of gold when ETFs were introduced, we could have a very good next 2 years.
Rewind the clock with me back to 1980.
At this time gold was trading for $800 an ounce.
Over the next 20 years gold basically was in a bear market.
Making lower lows and never again sniffing new highs.
A chart of that price action can be seen here:
(Source: https://twitter.com/hashtag/bitcoin)
Then, all of sudden, prices started going up...
Around the year 2000 something changed.
We had the first couple of gold ETFs introduced in 2003 and shortly after prices started going up again.
This marked the first time ever that institutions could buy large quantities of gold, via ETFs, and not have to worry about storing it.
Buying tons of gold was not practical for any fund, but buying thousands of GLD shares was.
How does that relate to bitcoin?
Well, for my money, I think we get a bitcoin ETF launched at some point within the next 2 years.
There is simply too much demand for one not to get through.
When that happens, it will solve the same problem that prevented gold from being more widely held by institutions...
The problem of custody.
Once institutions can buy bitcoin exposure just by purchasing shares in their regular brokerage account, they are going to move into the space in droves.
Look at a chart of bitcoin today and see if see some similarities to that of gold right before ETFs launched:
(Source:
)https://twitter.com/styt12332/status/1097862332288589824
- styt12332
Do you see what I see?
For those clamoring about how it took gold 20 years before it started going up again... I would reply with saying markets are night and day compared to what they were then.
For one, the internet didn't even really exist for most of that bear market.
People could not just click a button to buy or sell something, they had to look up the price in a newspaper then call their broker and tell them they wanted him to buy or something for him.
As you can imagine, things move much much faster today.
For that reason I think the current bear market in bitcoin, on the eve of bitcoin ETFs, looks eerily similar to what happened in the gold market from about 1980 through 2000.
Get your popcorn, it's going to be a fun next couple of years!
Stay informed my friends.
