Bitcoin has continually skyrocketed in price ever since it bottomed at around $3,800 in March early this year. With the dominant cryptocurrency now trying to target $25,000, a possibility of reaching $500,000 is on the horizon, said Alex Mashinky, CEO of Celsius Network.

When asked by Yahoo Finance if Bitcoin could reach $400,000 or even $500,000, Mashinsky said it will depend on the people who accumulate Bitcoin but don’t sell -- the so-called “holders” -- if they will sell at prices above $25,000, $50,000 and so on. “If the holder community is going to sit on their hand and not sell anything, then we’re going to get to those price levels very, very quickly,” Mashinsky told Yahoo’s Julie Hyman.

Mashinky noted that the rally this 2020 is very different from the bull run of 2017. At the time, there was a mass dash by retail investors trying to buy the cryptocurrency. This can be seen in Google Trends, where peak search interest for Bitcoin was still in December 2017, he said. 

“You don’t see that today because it’s a much broader adoption both from institutions and from family offices and so on,” said Mashinky, who argued that while retail in 2017 wanted to buy and sell eventually to profit, the institutional investors of today are not selling. “They’re just going to accumulate, and that makes all the difference.”

When asked why Bitcoin has value, Mashinky said it’s not just because people decide it has value. Throughout history, scarcity is a primary factor for something to have value. With the current economic uncertainty and the constant money printing from major central banks, the Celsius Network CEO said people are starting to realize that those assets with scarcity are potential hedges against inflation. He thinks the older generation is into gold as an insurance policy against it. For the younger generation, it’s Bitcoin, which is even more scarce than gold, Mashinsky added.

Mashinsky has observed that even within the Celsius community, which is around 250,000 people globally, people are just accumulating, not selling or trading. 

For this reason, Bitcoin really is an incredible store of value. “It is not a great form of payment. It is not a great medium of exchange, but it’s an exceptional store value. It’s the best performing asset class in the last 10 years,” Mashinsky concluded.

Bitcoin was created in 2008 Bitcoin was created in 2008 Photo: AFP / JACK GUEZ