These 3 companies could sprint ahead of Wall Street when it comes to cryptocurrency
- 2018 and 2019 could be a big for the cryptocurrency market, according to Fundstrat.
- The firm predicts bitcoin will hit $25,000 by the end of 2018, and sees three companies possibly launching their own digital coins.
Fundstrat, the research firm, is predicting the next two years will be big for bitcoin and the world of crypto.
In a note out to clients, analysts led by Tom Lee said at least three companies could issue their own digital tokens in 2018 and 2019. They also doubled down on their bullish forecast for bitcoin, which they say could reach $25,000 by year-end.
"The fundamental story of crypto is improving in 2018," according to Fundstrat. "And improving apps, such as Robinhood, and now Circle (acquiring Poloniex), are [creating] new on ramps for users this year."
Robinhood, the California brokerage known for its popular stock-trading app, launched Robinhood Crypto earlier this month. On Monday, payments company Circle announced its acquisition of crypto exchange Poloniex. It is also working on launching its own crypto-trading smart phone app, Circle Invest.
Bitcoin gripped the attention of Wall Street and Main Street as its soared to almost $20,000 in December 2017. The start of 2018 was rough to the digital coin, throwing it all the way down to $5,900 at the beginning of February. But a quick read of the chart indicates that rest of the year will be bullish for bitcoin. Here's Fundstrat:
"In 6 of the last 7 years, bitcoin posted its annual low within the first 60 days, before March. In 2018, bitcoin was down 50% by Feb 6 (36 days), which falls within that time frame. In other words, as we enter March, this is another reason to view 5,900 as THE LOW for the year and we see bitcoin reaching $20,000 by mid-year and $25,000 by year-end."
As for the crypto ecosystem more broadly, Fundstrat notes three non-financial companies are in the process of issuing or could issue their own digital coins in 2018 or 2019.
Starbucks, the ubiquitous coffee maker, is one company that could dive into crypto in the next 12 to 24 months, Fundstrat said. It's something the company has hinted at before.
"I think blockchain technology is probably the rails in which an integrated app at Starbucks will be sitting on top of," Howard Schultz, the company's executive chairman, told Fox Business on Tuesday.
Schultz mentioned the possibility of launching a "proprietary digital currency" as part of those efforts.
Line, a Japanese company, could also launch a digital currency exchange in the next 12 to 24 months.
"The company said it has started the process of registering a virtual currency exchange with the Financial Services Agency but gave no indication as to when this will likely bear fruit," Fundstrat wrote. "Likely to launch a token in conjunction with this effort."
Also, ecommerce company Rakuten is one company that has already announced it's launching a cryptocurrency based on its loyalty program.
Meanwhile, Wall Street banks are staying far away from digital currencies. Financial advisers employed by Bank of America Merrill Lynch were instructed to not hawk Grayscale's Bitcoin Investment Trust, an investment product that seeks to mirror the price of bitcoin, to clients. JPMorgan head Jamie Dimon famously called bitcoin "a fraud," and he once said he would fire bankers who trade it for being stupid.