Bitcoin’s rebound has prepared the way for six-figure price estimates, which were common during the pandemic-era crypto boom. The token’s monthly streak puts history on the side of such audacious optimists.
Bitcoin is likely to rise for the fourth month in a row after eking out an April gain, the greatest such run since a six-month surge from March 2021 to March 2022. According to Bloomberg data, four-month winning streaks in the past decade have forecasted an average Bitcoin increase of 260% the following year.
A surge of that scale would take the largest digital asset to a new high of $105,000, up from around $30,000 now, where its 77% recovery from last year’s severe crypto collapse has halted considerably.
During the revival, Bitcoin has changed narrative garb like a chameleon, drawing support from bets on a Federal Reserve pivot to looser monetary policy, the perceived blow to fiat currency from the US banking crisis, and a planned halving of the supply of new tokens due next year.
“The biggest thing for crypto is that it’s a lightning rod for liquidity,” CMC Invest Singapore president Christopher Forbes remarked on Bloomberg Television. “And as liquidity returns to the market, which it is and we are seeing, I believe cryptocurrency will continue to trade well.”
Standard Chartered Bank, BCA Research, and Bloomberg Intelligence have all recently indicated plausible paths to at least $100,000 for Bitcoin.
“The recent banking-sector crisis has helped to re-establish Bitcoin’s core use case as a decentralized, trustless, and scarce digital asset,” stated Geoff Kendrick, Standard Chartered’s head of crypto and EM FX West research, in a note.
According to BCA Associate Vice President Juan Correa-Ossa, Bitcoin has the potential to partially replace gold as a store of value in a digitalizing society in the long run. Correa-Ossa said in a note that if the token hit 25% of the market capitalization of the yellow metal, Bitcoin’s price would be $160,000.
According to Jamie Douglas Coutts of Bloomberg Intelligence, if 1% of global bond market value migrated to Bitcoin, the price would reach $185,000.
None of the analysts believe such paths are unavoidable, but the fact that they are being considered indicates a shift in tone from 2022, when digital assets plummeted and the FTX market was the focus of a string of meltdowns.
Bitcoin and the larger crypto world are still vulnerable to a number of threats, not least the US government’s crackdown on the sector. According to BCA’s Correa-Ossa, a shorter-term risk is if traders reduce their expectations of softer Fed policies.
The multiple crosscurrents, in the midst of acute economic uncertainty, make forecasts for real and virtual assets difficult to decipher. Bitcoin is still approximately $40,000 behind its all-time high of nearly $69,000 in 2021.
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“Crypto markets have cycles as well, but these have historically been driven primarily by crypto-specific factors,” noted Noelle Acheson, author of the “Crypto Is Macro Now” newsletter. “Not any longer – the crypto market now has multiple drivers, making the narratives more complex while also opening up the market to new investing cohorts.”