Bitcoin could hit $50K in 2023 and $120k by 2024 – Standard Chartered
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(Kitco News) – Standard Chartered has upped its bullish predictions for Bitcoin (BTC) for the next year and a half, saying in its analysis released on Monday that the top crypto could reach $50,000 in 2023 and top out at $120,000 by the end of 2024.
This latest prediction from the British multinational bank follows its update from April that said the “crypto winter” was over and predicted BTC would hit $100,000 by the end of 2024.
In its new analysis, Standard Chartered predicted that the recent rise in BTC price could encourage Bitcoin miners to hoard more of the supply, which would decrease the amount available for trading purposes and put positive pressure on its price.
This put an extra 20% upside on the bank’s previous call for $100,000 by the end of 2024, according to Standard Chartered FX analyst Geoff Kendrick.
“Increased miner profitability per BTC (bitcoin) mined means they can sell less while maintaining cash inflows, reducing net BTC supply and pushing BTC prices higher,” Kendrick said in the report.
The process of mining currently results in the minting of 900 new Bitcoins each day, and the rising price of BTC means that miners need to sell fewer of their proceeds to cover their costs, which Standard Chartered said will encourage them to hold onto their tokens as they wait for higher prices.
Kendrik said that while miners have recently been selling 100% of their new coins, a price increase to $50,000 could result in them only needing to sell 20-30% to stay in operation.
“It is the equivalent of miners reducing the amount of bitcoins they sell per day to just 180-270 from 900 currently,” he said. “Over a year, that would reduce miner selling from 328,500 to a range of 65,700-98,550 – a reduction in net BTC supply of roughly 250,000 bitcoins a year.”
Another upcoming development that could encourage miners to hold their BTC for a higher price is the Bitcoin halving, which is currently predicted to occur on April 16, 2024. During a halving, the new supply of Bitcoin minted with each block is cut in half, reducing the amount of new tokens coming into the market.
The block reward is currently 6.5 BTC, meaning that after the next halving, the block reward will drop to 3.25 BTC. This translates into a total of 450 BTC being minted each day.
During the lead-up to previous halvings, Bitcoin’s price has historically bottomed between 517 and 547 days prior, which aligns with the most recent bottom in the BTC market on November 19.
A chart on the performance of Bitcoin relative to the halving cycle was provided by Cryptollica, which shows that BTC price begins to trend up as the halving approaches, followed by a blow-off top phase where its price experiences a parabolic rise and then a rapid sell-off.
BTC/USD 1-week chart. Source: Twitter
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