Forecasting Whether $100,000 is Possible for Bitcoin?
Bitcoin is quickly passing each new $1,000 in value, and spot bitcoin ETFs are seeing enormous influxes of capital.
Wednesday saw the first time the price of the original cryptocurrency (BTC) above $63,000, marking the first time it has done so since the high of the last bull market in November 2021.
Coinciding with this week’s massive surge, U.S.-traded spot ETFs have seen massive inflows of capital, with new funds adding over 12,000 bitcoin on Tuesday, following an addition of over 10,000 on Monday. Plus, it’s happening in April, just before the so-called “bitcoin halving”—an event that happens every four years and is typically accompanied with substantial gains as the creation of new bitcoin slows down.
Even while Bitcoin’s ascent has been going strong for months, it really took off this week. Only a short time ago, its price was lower than $51,000. It surpassed $63,000 shortly after crossing $60,000 a few hours earlier.
As of this writing, bitcoin’s 24-hour gain had surpassed 10%. There was a 7.8% increase in the wider CoinDesk 20 Index, which is a measure of the top cryptocurrencies.
Bulls in Bitcoin are reportedly aiming for the cryptocurrency’s all-time high of $69,045 reached on November 10, 2021, as reported by Coingecko.
The positive acceleration that occurred in the previous three days, when the price of the coin increased by about 15%, is still visible as Bitcoin maintains its upward trend and extends rally into fifth consecutive day.
The new US spot bitcoin ETF’s approval to trade has caused demand to surge, and large long positions from major players have been the primary factor propelling Bitcoin’s price in the past few days.
Bitcoin is expected to experience its largest monthly gain (about 40%) since October 2021 as bulls maintain their solid grip and approach the critical 60,000 mark.
Coin’s all-time highs at 68421 and 68911 (recorded in April and November 2021, respectively) and a sustained break of the 60,000 pivot point will bolster the fresh positive signal that was generated by Tuesday’s finish above the Fibo barrier at 56291 (76.4% retracement of 68911/15437 downtrend).
Demand is still high, so far, so good for the bulls. However, after such a big advance in the past few days, it is reasonable to expect some profit-taking in the near future.
Launched in 2009, bitcoin (BTC) has captivated IT enthusiasts and investors since its inception. From below $500 in 2013 to over $64,000 in 2021, the cryptocurrency’s value has risen at an unprecedented rate.
Following a precipitous fall from such lofty levels, bitcoin fell below $17,000 in 2022. Nevertheless, the cryptocurrency has subsequently had a surge, going as high as $60,000 on February 28, 2024. This has prompted numerous investors to question whether bitcoin may surpass its previous highs and reach six figures.
By what date will bitcoin reach $100,000?
In the days, weeks, months, or years to come, nobody can say with certainty whether the value of bitcoin will increase or decrease. But looking at how much Bitcoin has changed in price in the past can give you a clue as to where it might go from here.
About $800 was the value of bitcoin in January 2014. Its value had increased to about $42,000 by the beginning of 2024. In terms of yearly return, that works out to over 135% over the last decade, and a price gain of almost 5,150%.
If bitcoin’s average yearly returns continue to grow at their current rate, its value will reach $98,700 in January 2025 and $100,000 in February of the same year.
The value of bitcoin, according to some analysts, has the potential to rise considerably more. The executive chairman of HIVE Digital Technologies, Frank Holmes, predicts that the price of the data center could quadruple in the next year.
Another person who thinks bitcoin could see significant price increases this year is Bitwise’s chief investment officer, Matt Hougan. The author predicts that bitcoin will reach new records this year, stating, “We think bitcoin is in a multi-year bull market.”
The possible price changes of bitcoin are more complex than this, of course. The value of bitcoin dropped by half or more in a short period on many occasions over that decade of 135% annualized gains, demonstrating how unpredictable cryptocurrencies can be. It took months or even years for bitcoin to regain its former highs.
For what reasons could Bitcoin’s price increase?
A couple of things have happened that could make bitcoin more expensive.
Ethereum token sales
The first spot bitcoin exchange-traded funds were approved by the US Securities and Exchange Commission on January 10th.
Providers can now establish ETFs that buy and hold bitcoin directly for investors thanks to the approval of those new ETFs. The ability to trade Bitcoin at its current, or spot, price is a boon for investors. Only bitcoin futures contracts were previously available for trading by ETFs.
Only highly experienced investors should trade futures, as they are complicated derivatives instruments.
Spot ETF approval, according to many investors, may make bitcoin more accessible as an investment and entice people who had never owned bitcoin before because of how complicated it is to buy crypto.
“Supply and demand determine the price of Bitcoin. The introduction of bitcoin exchange-traded funds (ETFs) has created a huge new demand stream, according to Hougan.
The Halving of Bitcoin
There is another consideration when it comes to the supply of Bitcoin. One more halving of Bitcoin is on the horizon.
A distributed network of computers is what makes Bitcoin work for confirming transactions. The term for what those machines are doing is “mining” bitcoin. Each time a miner successfully validates a block of transactions by producing the proper cryptographic solution, they are rewarded with additional bitcoin.
There will only ever be 21 million bitcoins in circulation, and every so often, the reward for validating a block is cut in half. Based on the number of blocks authenticated, the next halving will occur at a later date. Still, May 2024 is when most people anticipate the next halving to take place.
There will be less new bitcoin available for purchase after a halving event, which has often led to more trade and more demand for the cryptocurrency.
The yearly inflow of fresh supply into the market will drop by about $7 billion in April. Hougan thinks it’s a pretty good setup: new demand sources, less fresh supply.
Solution Level 2
Last but not least, layer-2 solutions have increased the scalability and utility of the bitcoin network, which is driving up its price.
The original intent of the Bitcoin network was to facilitate mining and the transfer of bitcoins from one wallet to another. Just one cryptocurrency’s digital ledger. But now it has new uses, such in decentralized apps or smart contracts.
With the inclusion of these new apps, the Bitcoin network becomes more useful, which could lead to an increase in its value.
A Recurrence of Bitcoin’s Crash?
Extreme volatility has been a hallmark of Bitcoin’s history. Bitcoin was worth a few cents when it first came out and a few bucks for a long time after that.
However, there have been major price fluctuations in the coin since then.
A high of $60,000 was reached in April of that year, but by July of the same year, it had dropped below $30,000. In November of that year, bitcoin’s price soared again up to an all-time high of $65,000, before crashing to a 2022 low of about $16,000.
According to CFP and CPA Howard Hook of EKS Associates in Princeton, New Jersey, there are a number of factors that could lead to a bitcoin crash. Regulatory concerns are one of the biggest threats that Bitcoin’s value could plummet or fall once more. The emergence of a new cryptocurrency that overtakes Bitcoin in terms of popularity is another potential problem, according to Hook.
“The value of an intangible asset can plummet if a large number of people decide to sell it today due to its finicky nature.”
One thing that Holmes is quick to point out to investors is that government actions often herald upcoming changes. A major threat to bitcoin’s value, meanwhile, is anti-crypto legislation.
The Effects of Bitcoin on the Environment
Many investors may shift their focus to other cryptocurrencies or call for more regulation if they are worried about bitcoin’s effect on the environment.
By 2022, bitcoin was consuming 65 megatons of CO₂ and 65 terawatt-hours of power annually, which was enough to power Argentina’s entire population.
Is There Any Benefit to Using Bitcoin Now?
Once again, the price of one Bitcoin surpassed $50,000 on February 12th. Still, that’s a long way off from bitcoin’s all-time high of almost $64,000, and it’s not out of the question that the cryptocurrency might reclaim that kind of growth.
The fact that government regulators and influential figures in the financial sector are showing interest in crypto suggests that it may be here to stay.
Maturity is setting in on the cryptocurrency market. Launched in 2009, Bitcoin was the pioneer of a whole new asset class that was unknown to all but the most tech-savvy investors.
Today, there are hundreds of different cryptocurrencies, each with its own market valuation in the tens or hundreds of billions. Despite considerable volatility, the value of cryptocurrencies has grown tremendously over the past 15 years, while other newly minted digital assets like NFTs have come and gone.
Is Bitcoin a Good Investment?
Bitcoin may be a good investment option due to its past returns. The establishment and sale of spot bitcoin ETFs and other recent developments have made adding bitcoin to an investor’s portfolio easier than ever before.
Some people think the diversity and possible profits are sufficient to justify the risk.
“Investors can find Bitcoin and gold appealing as a way to diversify their portfolio assets,” Holmes explains.
Bloomberg surveyed 600 investors last summer to find out what they would hold in the event that the United States defaulted on its debts and the debt ceiling was reached. After gold and Treasuries, Bitcoin ranked third among the assets.
However, bear in mind that there are substantial risks associated with cryptocurrencies. Bitcoin may be older than 15 years, but the cryptocurrency market as a whole is very new. This makes predicting whether or not bitcoin will be in use and valued a decade from now a challenging task.
According to Hook, regular people who invest shouldn’t do it. The asset is speculative by definition. Even though it’s being used as a digital money, the price of the coin is heavily influenced by speculation about its potential, according to Hook.
But according to Hougan, crypto offers a great chance. “Risk and reward are inseparable,” Hougan states. “Usually, you’ll find a lot of both in bitcoin.”
