Over the past week, Bitcoin (BTC) has finally begun to falter. After weeks of non-stop bullish price action, which resulted in cryptocurrencies gaining 100% in two months’ time, buyers have begun to relent.
And as a result, BTC has fallen to $7,650 — around 20% lower than it was at its local peak, $9,100. In spite of this, many analysts are still overwhelmingly bullish, drawing attention to the fact that strong fundamental developments should drive demand for cryptocurrency.
How Facebook Can Drive Bitcoin Higher
In the past 24 hours, Bitcoin has lost approximately 3%. While some say that this is a bearish sign, there remain optimists. In a recent Forbes article, Naeem Aslam of Think Markets U.K. doubled down on his prediction that BTC may soon skyrocket past $10,000.
Aslam, who once called for Bitcoin to eventually reach a valuation in the hundreds of thousands of dollars, explained that June has historically been a good month for cryptocurrency.
Citing data he gathered, the analyst noted that the five-year trailing high growth for BTC in June is 25.98%, implying that “the price of Bitcoin can rise up to $10,712.”
That’s all well and good, but what will drive demand? According to Aslam, the impending launch of Facebook’s digital asset will. For those unaware, the social media heavyweight is expected to release the white paper for its cryptocurrency, dubbed “Globalcoin” or “Libra”, on June 18th.
Although the actual launch of the asset is not slated to arrive until late-2019 or early-2020, many are sure that this move alone will validate Bitcoin and digital assets on the global stage. Globalcoin is expected to be a stablecoin backed by an array of fiat currencies that can be used in Facebook’s ecosystem as a digital medium of exchange. Aslam writes that the white paper will be a “catalyst” for Bitcoin’s price to move higher.
He is far from the only one to think so. Analyst and industry commentator Luke Martin recently explained that for much of crypto’s history, entrants to the industry started with Bitcoin. Bitcoin is, of course, the “largest, most well-known, first decentralized cryptocurrency” that acts as an on-ramp to any other cryptocurrency ecosystem.
But with Facebook in the fold, Martin suggests that Globalcoin may usurp Bitcoin’s status as the cryptocurrency onramp. This isn’t postulation, as it is expected for Globalcoin to be easily purchased/gained through physical automated tellers, regulated exchanges, and purportedly a rewards system for Facebook users. And from there, Globalcoin adopters will be eased into the broader cryptocurrency space.
New entrants to crypto start with Bitcoin.
The largest, most well known, first decentralized cryptocurrency is the onramp for nearly every other cryptoasset.
Globalcoin (@facebook coin) might change that by bringing more new entrants to Bitcoin than any other coin in history.
— Luke Martin (@VentureCoinist) June 6, 2019
What do the numbers look like? You may be asking. Well, according to Ari Paul of BlockTower Capital, even a conservative estimate of Facebook’s impact on the cryptocurrency space is already looking amazing.
In a Twitter thread published earlier this year, Paul explained that if 300 million of Facebook’s two billion users were to adopt the corporate cryptocurrency, 10% of this 300 million could “stumble across” Bitcoin.
This would “double the number of Bitcoin users, increasing the pace of adoption, the network effects, and the value of the network.” No price target can be extrapolated from these numbers, but such an inflow would likely result in the biggest influx of buying pressure this space has ever seen.
The Importance of $10,000
So back to the $10,000 target. As reported by Blockonomi previously, Fundstrat Global Advisors’ Tom Lee believes that once BTC hits five figures, all hell will break loose for the cryptocurrency market.
As Lee wrote on Twitter earlier this month, “[$10,000] will see FOMO from those who gloated about the 90% crash in BTC… and those who saw Bitcoin dead as forever.”
He went as far to say in a recent podcast with Binance’s chief financial officer that once the aforementioned level is breached, BTC will be clear to shoot to $20,000 and $40,000 within a few months’ time.