Analyst: Inflation Is Key for Bitcoin Run To $200,000
25 Apr, 2024 ● Crypto people
The price of Bitcoin has experienced significant growth throughout 2024, driven by the introduction of various spot exchange-traded funds (ETFs) and its established status as a store of value.
Zach Pandl, the research director at Grayscale, anticipates that interest in Bitcoin will remain high, especially as the United States continues to engage in high levels of government spending and discussions around interest rate policies.
He noted, "We expect persistent inflation and unsustainable budget deficits to contribute to continued demand for store-of-value assets, like Bitcoin."
Jupiter Zheng, a partner at HashKey Capital’s liquid fund, acknowledges the complexity of forecasting Bitcoin's future price due to numerous influencing factors.
However, he sees considerable growth potential, estimating that Bitcoin could reach $200,000 by year's end.
He detailed his forecasts in an interview: "Low prediction will be $100,000, medium one is $140,000, and high prediction is $200,000, by the end of 2024."
Zheng also noted the positive influence of ETFs on the crypto market, highlighting how these products have made crypto investments more mainstream and accessible, thus broadening the investor base.
He believes that, over time, Bitcoin’s price movements will begin to reflect those of traditional assets such as stocks and gold, leading to more stable growth and its integration into mainstream investment portfolios.
Venture capitalist Tim Draper predicts a significant increase in BTC value in 2024, driven by ETF inflows and the effects of the Bitcoin halving.
At Paris Blockchain Week, Draper shared his positive outlook, predicting Bitcoin could reach $250,000 by the end of the year based on favorable market conditions.
The launch of spot Bitcoin ETFs in the United States has revitalized interest and investment in Bitcoin, providing an easier entry point for investors hesitant about direct cryptocurrency ownership and offering a hedge against depreciating fiat currencies, according to Draper.
Although previous halving events provide some historical perspective, the introduction of ETFs has added new layers of volatility due to variable demand.
The current market dynamics, with the global roll-out of spot ETFs, suggest potential for a significant increase in demand for Bitcoin in the coming months, which could push prices higher.
On the other hand, the ease of trading ETFs might introduce more price volatility as investors can more readily enter and exit positions compared to holding Bitcoin in self-custody.
Zheng commented on the current pricing models:
"Our current model price is $90,000. A more bullish scenario is $125,000, and a bearish one is $50,000."
He also identified key factors influencing these projections:
"The key factors are the spot BTC ETF net inflows (as a measure of TradFi adoption process), the Fed interest cut late this year, the 2024 BTC halving (creating more imbalance of demand and supply)."
While it remains challenging to pinpoint the exact value of BTC by the end of 2024, experts generally agree on an upward trend in its price, driven by significant ETF inflows, its role as a store of value, and prevailing macroeconomic conditions.
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