Bitcoin’s Wild Roller Coaster Ride Continues
May 28, 2021, 8:13 am EDT
Bitcoin is becoming a battleground stock, just like Tesla. Wall Street target prices for the electric vehicle maker range from about $100 to $1,200 a share. That means more volatility for traders.
Bitcoin, of course, isn’t an actual stock. There is no Bitcoin management team making strategic decisions and no Wall Street price targets to look up. But there are groups of increasingly polarized bulls and bears.
The bulls are led by ARK Invest’s Cathie Wood. She defended Bitcoin Thursday saying global currency regulators will eventually warm to cryptocurrencies. Her Bitcoin target price is $500,000.
The bears seem to fall into two camps. In one camp are ESG-minded investors warning that Bitcoin mining, which uses lots of electricity, is leading to a surge in unnecessary greenhouse gas emissions.
Another camp includes global central bankers and other skeptics, warning investors that Bitcoin is speculative and will never be used for transactions—to buy actual things
The battle and news volleys from bulls and bears leave Bitcoin investors nauseous from the ups and downs.
Bitcoin closed last Friday at a little more than $35,000. This Friday, Bitcoin is trading at a little more than $35,000. But over that span, prices have risen as high as $42,000 and dropped as low as $31,000.
Tesla CEO Elon Musk is an important cryptocurrency bull, like Wood. But Musk recently stopped accepting Bitcoin as payment for Tesla vehicles because of ESG concerns. He falls in the middle of the debate for now. Musk picking sides might be the next catalyst driving Bitcoin out of its recent range.