- Bitcoin’s price has stagnated over recent weeks in a tight range.
- Despite this price action, the fundamentals for the cryptocurrency are rapidly strengthening.
- Investors in Bitcoin got a boost just recently when the International Monetary Fund called for a new Bretton Woods moment.
- Bretton Woods was the agreement in 1944 that integrated the gold standard and implemented a monetary world order.
- Analysts think that this call for “another” Bretton Woods moment will boost Bitcoin.
- The details about this announcement were vague but some see it as a sign of more fiscal stimulus.
Bitcoin Bulls Roar Amid Call for “New Bretton Woods” Moment
While Bitcoin is a new technology and asset on a macro scale, many of its investors harken back to historical monetary and economic events to explain why it’s relevant. One such event is the Bretton Woods standard that pegged the top world currencies to the dollar, which in turn was “pegged” to gold reserves.
Recently, the International Monetary Fund called for a “new Bretton Woods moment.”
In a speech/letter, the IMF’s new managing director Kristalina Georgieva said that the pandemic is showing that there is a need for an overhaul to the world monetary system:
“Today we face a new Bretton Woods “moment.” A pandemic that has already cost more than a million lives. An economic calamity that will make the world economy 4.4 % smaller this year and strip an estimated $11 trillion of output by next year. And untold human desperation in the face of huge disruption and rising poverty for the first time in decades.”
While the statement about this was vague, Raoul Pal, CEO of Real Vision and a former hedge fund manager, says that this is a sign that more fiscal stimulus is coming:
“Talking of Bretton Woods, this IMF article alludes to a huge change coming but lacks real clarity outside of allowing much more fiscal stimulus via monetary mechanisms… Fiat globally will be worth less versus hard assets. And that means that gold and in particular #Bitcoin will become THE way to circumvent the system of ever lower value. It also create incentives systems for other nations to opt into a hard currency system to attract capital.”
If you don't think Central Bank Digital Currencies are coming, you are missing the big and important picture. This is going to be the biggest overhaul of the global financial system since Bretton Woods.
— Raoul Pal (@RaoulGMI) October 18, 2020
Where Will BTC Reach?
Amid this new standard, Bitcoin could rise as a way out or as a hedge against inflationary risks.
Pal thinks that the cryptocurrency could hit $100,000 and beyond this market cycle as Bitcoin and cryptocurrencies establish themselves are alternatives.
He even went as far as to say that the coin could surmount gold’s market capitalization of $10 trillion in the years ahead.
Photo by Jr Korpa on Unsplash Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com Bitcoin Investors More Bullish Than Ever as IMF Call For "New Bretton Woods"
Source: Bitcoinist News