Analysts Say Bitcoin Breakout Imminent - $5 Trillion in Cash Could Flow Into BTC

[Lucius]

Although I don't pay too much attention to the various experts who speculate every day what the price of Bitcoin will be tomorrow or in a month, something caught my attention in this particular case. It’s about the fact that we currently have $4.6 trillion cash "that is sitting in money market accounts", which is again the largest such amount since 1993.

What analysts like Dan Tapeiro, John Morgan and popular crypto trader Macnbtc speculate on is fact that there is so huge amount of money, and that Bitcoin is following silver trend from 12 years ago. Of course, they all think that part of that money will go in the direction of Bitcoin and gold. This is not some new theory, but it is interesting given the current economic situation, and only 10% of that money would mean almost $500 billion investment in Bitcoin.

A number of venture capitalists and macro investors believe bitcoin’s price will break out soon following suit with gold’s recent climactic rise. Dan Tapeiro, cofounder of Gold Bullion International, thinks that $4.6 trillion in cash sitting on the sidelines right now, could very well flow into precious metals and crypto-asset markets. Moreover, other investors have noted that bitcoin is following the same trend silver did in 12 years ago.

[LeGaulois]

An interesting question is, what are they waiting for to send this money? The end of the dollar's supremacy? that may never happen (I hear about it since I'm born)
Something related to Covid-19? I don't think so, looking at the graph it can be noted that this tendency to pile the cash has especially started to become more evident in 2018-2019

[Arkann]

Indeed, today quite a lot of statements by different analysts sound and to each of them cryptocurrency users can feel a different degree of trust. Recently, almost the majority of analysts claim almost the same thing, namely, about the large-scale growth of Bitcoin in the near future, although their forecasts have completely different bases and sources. The same remarks can be heard from the Fundstrat analytical department. According to their forecasts, Bitcoin can be raised from 200 to 400% in the near future and their forecasts are based on studies of the FOMO period. After analyzing the performance of Bitcoin during the last FOMO, it turned out that after that, prices for Bitcoin began to rise precisely in the range of 200 - 400 percent. And the head of the analytical department, Thomas Lee, said that the price of $ 10,000 for one Bitcoin would be exactly the same FOMO level in the current period. Based on this, we will have to wait a little more when Bitcoin reaches $ 10,000 and then it is quite possible we will observe a rally in the cryptocurrency market.

[BrewMaster]

An interesting question is, what are they waiting for to send this money?

most probably the same thing as everyone else in the bitcoin market is waiting for. a signal.
it could be a drop to buy more amount of bitcoin for the same amount of money (aka buy at a discount) which is what every greedy investor does. or it could be the breakout to see the rally begin then jump in to be sure you are not missing any chances to buy "cheap bitcoins".

[Lucius]

An interesting question is, what are they waiting for to send this money? The end of the dollar's supremacy? that may never happen (I hear about it since I'm born)
Something related to Covid-19? I don't think so, looking at the graph it can be noted that this tendency to pile the cash has especially started to become more evident in 2018-2019

For some reason investors don’t want to invest their money in absolutely anything, at least for now. Which is a little weird, though, because the money that just stands is actually losing its value - but obviously some people estimate that any investment is an even greater risk. What each of us should ask ourselves, if we had, say, $10 million or $100 million, would we invest some of that in gold or BTC at this moment?

I think that some of the rich people are still quite happy with what they have, and fiat will always be king for them. Let's say that gold is not interesting to them (it is difficult to transfer, it cannot be used as a means of payment), and on the other hand Bitcoin is still quite unknown to them and is not globally regulated.

Of course, the effect of the herd should also be taken into account, here in the sense that people generally follow some of their idols - either political or economic. Those who are blind followers of Warren Buffett will never invest a single cent in Bitcoin, nor will the followers of US President Trump, who has openly expressed his negative opinion of Bitcoin.

Former national security advisor John Bolton's book is coming out soon (The Room Where It Happened), and will reportedly contain some details of what Trump asked of Treasury Secretary Steven Mnuchin to do about Bitcoin back in 2018. The negativity spread by such influential people definitely affects investors who simply respect their opinions, even if such opinions sometimes don't have much logic.

[justdimin]

Five hundred billion dollars coming into bitcoin would make the price skyrocket to insane levels however you do realize that it is not all about money coming in but also money coming out as well right? Just because the price is 170 billion or so in market cap right now doesn't mean suddenly we will have 670 billion dollar market cap or the price all will be the same with people buying or going up in a liner way.

When you reach to $20k bitcoin that 500 billion will be come around 300 billion already and we are going to see even more sales coming in constantly trying to take out a profit. So, unless that 500 billion suddenly buys bitcoin all at once in a minute, we are not seeing anything major, maybe $20-$30k levels but that's about it.

[exstasie]

$4.6 trillion in cash flowing into BTC? Right.

An interesting question is, what are they waiting for to send this money? The end of the dollar's supremacy?

On the contrary, they are holding dollar assets. They are betting on the dollar's supremacy and riding out the recession in cash. Traditionally this suggests they are waiting for an actual economic recovery and hedging against further decline in the equity markets.

Warren Buffett is sitting on record amounts of cash. Meanwhile the stock market recovery has been largely driven by retail investors, newbie traders, and sports bettors.

Who is the smart money? Wall Street or retail? One of them is very right and one of them is very wrong. Time will tell which is which.

[Lucius]

$4.6 trillion in cash flowing into BTC? Right.
On the contrary, they are holding dollar assets. They are betting on the dollar's supremacy and riding out the recession in cash. .

Who say that money will flow in BTC? It's just that the money exists and that it is possible that sooner or later it will go in some direction, one of the options is precious metals, Bitcoin, but why not bonds (those with negative interest had a total value of $15 trillion a few months ago), or maybe stocks. It is completely crazy and unserious to expect that all that money should go in the direction of BTC, but it is not unrealistic to think of at least 5-10%.

I understand those who bet on the US dollar, because it is a currency that will eventually be defended by all means, and that includes military force. The US dollar is strong also because of very strong foreign policy, we can freely say and extremely aggressive. Personally, I think that the Euro will collapse much sooner than the US dollar, although many have been predicting for decades that the US dollar will collapse for various reasons.

[exstasie]

$4.6 trillion in cash flowing into BTC? Right.

On the contrary, they are holding dollar assets. They are betting on the dollar's supremacy and riding out the recession in cash.

Who say that money will flow in BTC?

The article you posted.

Dan Tapeiro, cofounder of Gold Bullion International, thinks that $4.6 trillion in cash sitting on the sidelines right now, could very well flow into precious metals and crypto-asset markets.

The whole point of suggesting that $4.6 trillion in cash could flow into crypto is to imply that some of it will, of course. It's repetition of the old Bitcoiner dream, that money flowing out of stocks means money flowing into BTC.

It is completely crazy and unserious to expect that all that money should go in the direction of BTC, but it is not unrealistic to think of at least 5-10%.

According to these numbers, you should probably lower your expectations an order of magnitude: https://bitcointalk.org/index.php?topic=5255816.0

A majority of institutions surveyed will likely expose a very tiny portion of their portfolios to BTC, but that's also over the next 5 years.

[Lucius]

According to these numbers, you should probably lower your expectations an order of magnitude: https://bitcointalk.org/index.php?topic=5255816.0
A majority of institutions surveyed will likely expose a very tiny portion of their portfolios to BTC, but that's also over the next 5 years.

The article speculates that part of that money could go in the direction of Bitcoin (some other crypto) and precious metals, but not explicitly in the direction of Bitcoin. This is just speculation, and I have also expressed my opinion that it would be a great success if at least 10% of that money flow to Bitcoin.

10% of $4.6 trillion is $460 billion which doesn’t seem like much compared to what is written in the thread you linked.

Not a lot of money? They expect to have at least 0.5% of their portfolio allocated in, while it may not seem like much to us, we're talking about hundreds of billion dollars. Usually, we dedicate a low percentage to the risky investments (due to diversity and risk balancing).
We often hear we shouldn't allocate more than 5% to risky investments (or something like that), 1% here, 1% there, etc...

If we consider Blackrock for example, they manage like 7,000 billion USD, if they invest just 1% it's 700 billion injected in the market.

In that case, we are talking about much more money than $4.6 trillion, so even 0.5% of a few such large investors can very easily make the total value of the BTC market reach $1 trillion. If we connect this to the speculations of some famous people from the crypto world who expressed their opinions that the price of BTC by 2022/23 will be in six-digit numbers, then we can only hope that at least some of them know what they are saying.

I’m always positive about it all, even though I’m also a realist who always looks at the bigger picture. 5 years ago I was told to sell all my BTC for $200 because it would never reach $1000 again, which I unfortunately did. Fortunately, I learned from my mistake and I will not repeat it.

[STT]

Ultimately cash goes into productive assets, a house is justified as you use it every day and you can gain a yield by renting it out.   BTC in speculation might gain but it also requires this utility to retain value over medium to long term, the flow of cash will never be just one way but immediately starts leaking back out as people purchase items with their new value.
   Problem we have as humans is we anticipate the next change, the move after that perhaps and so on but can we envision an entire system and the interaction between all factors and parties inside and out affected by changes ongoing.   We cannot say what will happen with this excess liquidity until it forms as an apparent force in inflation.   FED specifically cycles new money mostly through QE programs and retained treasury debt, eventually it will hit the streets for all assets imo.
  Without a doubt the world changing will have greater effects then just price altering in this asset.   We know gold is going up and likely anything we use every day like energy and food.   I speculate currently energy is cheap because the world has lagged production efficiency improvements and because Dollar is not a reliable transmitter of value its damaging propagation of capitalist values across the world.  We are suffering poor growth especially in countries which are due to experience large changes such as China and India, just providing running water is giant growth when its a millions of people as its high utility.     I hope BTC can change the world for the better and Im sure value comes here if true but its too hard to guess what slice of the pie we get.

[jseverson]

Isn't this fairly typical in times of crisis? The last time it peaked was 2008 (something that is clearly seen in the graph), which coincidentally aligns with the 08 financial crisis. Gold did perform well afterwards, but depending how you define a break out, Bitcoin breaking out due do this might be a bit too optimistic. The future does look bright though for sure.