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Theres no hiding the fact that Bitcoin, at least in terms of its price, has underperformed amid the ongoing crisis unfolding around the world, caused by the coronavirus shutdowns the worlds governments have implemented.

Since the February highs at $10,500, the cryptocurrency has fallen to $6,500, marking a loss of just under 40%.

Despite this, there are a number of prominent analysts who think that Bitcoins fundamentals will only strengthen through this crisis.In fact, in a recent analysis, long-time market veteran Dan Morehead went as far as to say that during this crisis, Bitcoin will come of age.

Over the past few weeks, the global economy has spiraled into chaos; amid the coronavirus outbreak, unemployment claims have skyrocketed to record levels, prominent investment firms are projecting potentially Great Depression-level GDP contractions, and the stock market has seen its fastest crash in history, losing over 30% in a matter of a few weeks.

Due to this, governments and central banks have been forced to respond with their most drastic measures available boosted unemployment benefits, tax holidays, free money for all citizens, trillions of dollars worth of quantitative easing, and negative interest rates are amongst the measures being taken by the worlds authorities to try and save the flagging economy.

According to Morehead, this trend towards unorthodox monetary and fiscal solutions will be astronomically bullish for Bitcoin and some other assets. As he wrote in his companys latest newsletter:

As governments increase the quantity of paper money, it takes more pieces of paper money to buy things that have fixed quantities, like stocks and real estate, above where they would settle absent an increase in the amount of money. I think they will do that. The corollary is theyll also inflate the price of other things, like gold, bitcoin, and other cryptocurrencies.

He added that with the government deficit in the trillions, it will have a positive impact on the price of things not quantitatively-easable stocks, real estate, cryptocurrency relative to the price of money. Said another way, the BTC/USD cross-currency rate will rise.

With the backdrop set for Bitcoin, Morehead concluded in his letter by remarking that the leading cryptocurrency will likely set a new price high in the next 12 months, adding that rapid growth that some bulls expect is not going to happen overnight.

This was echoed by Raoul Pal ex-head of Goldman Sachs equity derivatives business and the current CEO of Real Vision who told an interviewer that he thinks the price of Bitcoinwill rally to its $20,000 all-time high within the coming 12 to 18 months.

This interview was released shortly after he remarked that he is more bullish than ever on Bitcoin, remarking that theres a possibility that all trust in the entire system has been lost. This was presumably in reference to the worlds response to the outbreak of COVID-19, which has revealed clear insecurities in the fabric of society, from politics to finance.

As to why it will take around 12 months for Bitcoin to reach new highs, Morehead explained:

My best guess is that it will take institutional investors 23 months to triage their current portfolio issues. Another 36 months to research new opportunities like distressed debt, special situations, crypto, etc. Then, as they begin making allocations, those markets will really begin to rise.

Indeed, with the three primary asset classes stocks, bonds (rallied, then crashed hard), and commodities all underperforming in tandem in the crisis, investors may begin to seek alternatives, cryptocurrencies included.

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Bitcoin Will "Come Of Age" During This Crisis: Top Investor Explains Why - Blockonomi