Gold bug Frank Holmes, CEO and chief investment officer at U.S. Global Investors, has revealed he believes Bitcoin’s halving event has helped the price of the flagship cryptocurrency surge this year, as demand was steady yet supply dropped.
During an interview with Kitco, first reported on by Bitcoin.com, Holmes revealed he is enthusiastic about both bitcoin and gold, but noted that the growing number of bitcoin wallets has shown there is demand for the cryptocurrency as people are “embracing bitcoin,” in a trend that has been growing over the last three years in a “nice steady trend,” he said.
The gold bug added that the block reward halving, which took place in May of this year and saw block rewards drop from 12.5 BTC to 6.25 BTC per block, helped the price go up and would do the same for the precious metal. He said:
If tomorrow, if all the gold mines in the world said we’re going to cut supply by 50%, I can assure you gold will be at $10,000.
Turning his attention to Ethereum, Holmes noted that the cryptocurrency’s price may have also been going up as supply dropped once users locked millions worth of ETH on the ETH 2.0 phase 0 contract, which kicked off the launch of the network’s long-awaited upgrade.
Developments in the decentralized finance (DeFi) space also contributed to Ethereum’s growth, and the cryptocurrency may soon perform as well as BTC did so far this year. As for the precious metal, Holmes said he sees an upside of up to 40% for it in 2021, risking a price prediction of “2,200 to $2,600 per ounce.”
Per his words, a “two-standard deviation move, which happens so often now in the past 21 years,” can help gold move between $400 to $800 up in the next 12 months. The precious metal, it’s worth noting, also hit a new all-time high this year.
Featured image via Unsplash.