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The owner of a controlling stake in Binance, the largest cryptocurrency exchange by trading volume, Changpeng Zhao said that Bitcoin will reach a new historical maximum price this year. The main growth factor should be a change in American legislation, the businessman explained.
According to Changpeng Zhao, the combination of big business interest and favorable regulation could lead to an atypically long and sustainable growth of the crypto market.
“Bitcoin typically follows four-year cycles, but I think this year, given favorable US pro-crypto policies, it will reach new all-time highs, deviating from its typical four-year pattern. “I have a very strong feeling about this,” the entrepreneur announced.
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Investors should prepare for a new reality, where cryptocurrency volatility will gradually decrease as large capital arrives, Zhao said. In the new conditions, Bitcoin ceases to be “just digital gold”, becoming the foundation of an economy that does not depend on short-term market conditions, said the co-founder of Binance.
Against the backdrop of falling trust in traditional currencies, the decentralized nature of Bitcoin with its mathematically limited emission makes the first cryptocurrency a non-alternative tool for long-term risk hedging, Zhao believes. The crypto market has outgrown the stage of blindly following trends, and such a transition will create the necessary layer of liquidity that will keep it from deep drawdowns even during periods of price correction, the owner suggested largest crypto exchange.
Earlier, Cathie Wood, CEO of the Ark Invest investment fund, said that Bitcoin was beginning to emerge from the current, weakest, phase of the four-year market cycle. According to the theory of cycles, after the reward to miners is halved (halving), the rate of the first cryptocurrency increases and then sharply decreases.
