What are the chances of an extremely bullish cryptocurrency rally, similar to the one that unfolded in 2017, happening again in 2020? According to Mike Alfred, CEO of Digital Assets Data, there are strong signs pointing towards a major shakeup of the digital currency markets, and Bitcoin could once again be the leading token. What Alfred sees is a perfect storm of economic conditions that may drive more investors to cryptocurrencies later this year.
The devastating effects of the coronavirus pandemic are certainly on the minds of Bitcoin traders. Alfred believes that we have not yet seen the full negative effects of multiple business closures that have been taking place around the world; in fact, we are just beginning to see the vastly reduced spending caused by millions of job losses. Traditional financial exchanges such as Wall Street have managed to stay afloat thanks to investors who are basically trading on good news alone. The United States, for example, has been increasing the size of the economic bailout package, and this is something that we will likely see in Australia, the United Kingdom, the European Union, and Japan.
Even though Wall Street traders have been keeping the market afloat by sheer day trading, this kind of action will eventually run its course and wind down. There is still considerable uncertainty about what the future may bring to the global economy, and this is why Alfred expects to see greater interest in the cryptocurrency markets.
More hedge funds are turning their attention to digital currencies, and not all of them are interested in Bitcoin. Major portfolio investors such as Paul Tudor Jones are very serious about their involvement in the cryptocurrency markets because they feel as if they have been sitting on the sidelines for too long. There is also the matter of JPMorgan Chase, one of the most influential banking giants in the world, softening its stance on digital currencies. Alfred has also mentioned that many of his colleagues are approaching him with questions related to cryptocurrency analytics; they realize that this is not a market that thrives on fundamental analysis, so they might as well start looking at technical charts.