Bitcoin’s boom has paved the way for the kinds of six-figure price projections that fueled the pandemic-era crypto boom. The coin’s monthly streak of ripening puts history on the side of such bold optimists.
Bitcoin is set to climb for a fourth consecutive month after paring April gains, the best such stretch since the six-month advance to March 2021. Over the past decade, the four-month gain foreshadowed an average bitcoin rally of 260. % in the subsequent year, data compiled by Bloomberg show.
A jump of that magnitude would propel the largest digital asset from currently around $30,000 to a record $105,000, territory where the 77% rebound from last year’s punitive crypto rout has somewhat stalled in 2023.
Bitcoin has changed narrative disguises like a chameleon during a revival, drawing success from bets on looser monetary policy at the Federal Reserve Pivot, the perceived blow to fiat currencies from the US banking crisis and a planned reduction in the supply of the new token — so-called halving. Is – due next year.
“The biggest thing that’s going to happen for crypto is that it’s been a lightning rod for liquidity,” Christopher Forbes, head of CMC Invest Singapore, said on Bloomberg Television. I think crypto will continue to do well.”
In recent days, Standard Chartered Bank, BCA Research and Bloomberg Intelligence have all identified possible paths for bitcoin to at least $100,000.
‘scarce’ asset
Geoff Kendrick, Head of Crypto and EM FX West Research at Standard Chartered, wrote in a note, “The recent banking-sector crisis has helped to re-establish bitcoin’s core use case as a decentralized, trustless and scarce digital asset.” have helped.”
BCA Associate Vice President Juan Coria-Osa said it is possible for bitcoin to partially usurp gold in the long term as a store of value in a digitizing world. If the token reaches 25% of the yellow metal’s market capitalization, the price of bitcoin will skyrocket to $160,000, Korea-Osa wrote in a note.
Jamie Douglas Coutts of Bloomberg Intelligence said that if 1% of global bond-market value moved toward bitcoin, it would take the price to $185,000.
US crackdown
No analyst is saying that such a trajectory is inevitable, but the fact that valuations are being made reflects a changed mood compared to 2022, when digital assets crashed and the FTX exchange reported bulls. It started raining.
Bitcoin and the wider crypto world remain exposed to a number of risks, not least in the US from crackdown on the sector. A shorter-term risk, according to BCA’s Correa-Ossa, is if traders leave behind expectations of a friendlier Fed policy.
Various cross-currents amid periods of apparent economic uncertainty make the outlook for real and virtual assets difficult to parse. Bitcoin remains roughly $40,000 down from its 2021 all-time high of around $69,000.
Noel Acheson, author of the “Crypto Is Macro Now” newsletter, wrote, “Crypto markets also have cycles, only in the past these have been primarily driven by crypto-specific factors.” “Not anymore – there are now multiple drivers in the crypto market, further complicating the narrative while opening up the market to new investment groups.”
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