Why Bitcoin Is Cheap At $23,000, Says Fidelity Expert

Bitcoin has been pushed down further over today’s trading session and approaches critical levels of support. Market cap first crypto has lost all profits last week and is currently in red.

Bitcoin (BTC), which trades at $23,400, has sideways movements in the last day and a loss of 2% over the past seven days.

BTC’s price moving sideways on the 4-hour chart. Source: BTCUSD Tradingview

Fidelity Jurrien Timmer is the Director of Macro at Fidelity Investments. believesInvestors who have been long-term Bitcoin traders may be able to grow their Bitcoin holdings while maintaining current levels. Via his Twitter account, the expert claims Bitcoin is cheap as he explored the cryptocurrency’s price versus value chart.

Timmer’s bullish thesis is based on BTC’s adoption curve and the likely scenario where this curve will continue to trend to the upside and increase the underlying value of the cryptocurrency. As seen below, there is a direct relationship between BTC’s adoption and its price.

Below you will see the BTC price/network relationship, which shows how Bitcoin reacts when there is more adoption. The former metric trended lower than BTC’s price until it was able to break above a critical resistance zone and turn into support.

Bitcoin BTC BTCUSDT Fidelity 1
Source: Jurrien Timmer via Twitter

Bitcoin has been moving on that support for over a month, coinciding with BTC’s price reaching a yearly low of around $17,700. As the chart above shows, these levels have historically operated well as resistance/support and hint at BTC’s price forming a bottom around that area.

Timmer said the following on BTC’s capacity to continue appreciating in the long term:

Bitcoin’s price-to-network ratio (my proxy for a valuation multiple) is back to 2014 levels. Its network is growing at a rate roughly equal to a power regression curve. My main consideration is the slope or adoption curve. Whether we use the mobile-phone curve or internet curve as proxies, Bitcoin’s price is below its actual and projected network-growth curve (…).

What Are the Current Prices of Bitcoin?

If Timmer’s predictions are correct, the price of Bitcoin should trend higher and reach an all-time high of $100,000 by 2050 as more people adopt it, and its circulating supply decreases. This could push BTC’s price near $1 million by 2030.

Bitcoin BTC BTCUSDT Fidelity 2
Source: Jurrien Timmer via Twitter

Timmer also compared BTC’s price to Gold and concluded that the cryptocurrency experienced its “biggest oversold condition in years”. This supports the expert’s theory that BTC’s price might have found a solid bottom on higher timeframes.

Timmer also reports an increase in BTC holders. 13% of the cryptocurrency’s total supply has entered the 10-year unspent period with more and more people buying it in the long run.

Get more Crypto News at CFX Magazine