Bitcoin may hit $10 000 by year-end

US hedge fund manager Mike Novogratz, who is starting a $500 million (R6.9 billion) fund to invest in cryptocurrencies, says the bitcoin rally still has some serious legs.

After surging more than sevenfold since December last year, the largest and most widely known digital currency will end the year at $10 000, he said.

Smaller rival ether will trade at $500 from almost $370 this week.

Bitcoin is like digital gold in that “gold has value solely because people say it has value; bitcoin is built on an amazing technology, there’s a limited supply of it”, Novogratz said.

“This whole revolution came out of a breakdown in trust in the 2008 [global financial] crisis.”

Bitcoin climbed to a record $8 374 this week after Novogratz’s comments.

Many of his former Wall Street colleagues don’t share his enthusiasm. JPMorgan Chase CEO Jamie Dimon has said anyone who buys bitcoin is “stupid” and will pay the price, while Neil Dwane of Allianz Global Investors said it’s a “scam for criminals around the world”. BlackRock CEO Larry Fink said it’s an index to gauge the demand for laundering money around the world.

However, Novogratz has a lot of company. There are now more than 100 cryptocurreny-focused hedge funds, with 84 opening this year, up from 11 last year, according to research by Autonomous Next. – Bloomberg

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

ZAR/USD
17.24
(+0.61)
ZAR/GBP
22.62
(+0.34)
ZAR/EUR
20.43
(+0.33)
ZAR/AUD
12.43
(+0.14)
ZAR/JPY
0.16
(+0.76)
Gold
2040.44
(+0.56)
Silver
26.79
(+2.38)
Platinum
954.00
(+2.19)
Brent Crude
44.34
(+0.63)
Palladium
2153.00
(+1.13)
All Share
57321.50
(+1.91)
Top 40
52973.32
(+1.97)
Financial 15
9850.54
(-0.28)
Industrial 25
75999.09
(+1.41)
Resource 10
59219.56
(+3.30)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 853 votes
It depends on how the funds are used.
74% - 5660 votes
No. We should have gotten the loan elsewhere.
15% - 1129 votes
Vote