Bitcoin’s price may be experiencing volatility, but its fundamentals remain strong, according to Standard Chartered, a global banking giant. Despite the short-term risk of price fluctuations, the bank has made bullish predictions for BTC. They anticipate that Bitcoin could skyrocket to $150,000 by the end of 2024 and potentially peak at $250,000 in 2025.
Standard Chartered’s analysts remain optimistic despite the current price action of Bitcoin in the first half of 2024, which has deviated from expectations. The bank has revised its price target to $100,000 by the end of the year and believes that the price could increase by over 130% in the second half of 2024, reaching a peak of $150,000 by the end of the year.
Their analysis is based on the success of gold exchange-traded funds (ETFs) in the US and the subsequent surge in the price of gold. Standard Chartered notes that the gold analogy, in terms of ETF impact and portfolio mix, is a good starting point for estimating the correct BTC price level in the medium term.
Many analysts and industry players have compared Bitcoin to gold due to its provable scarcity, limited supply of 21 million BTC, and status as a non-sovereign store of value. Investors increasingly view Bitcoin as “digital gold” and a hedge against inflation and economic turmoil in the digital age.
Standard Chartered also predicts that the price of Bitcoin could reach $250,000 in 2025 before stabilizing around $200,000, contingent on the success of Spot Bitcoin ETFs. The bank suggests that if ETF inflows reach their mid-point estimate of $75 billion or if reserve managers buy BTC, there is a good chance of the price overshooting to $250,000 in 2025.
Spot Bitcoin ETFs have played a significant role in the price increase of BTC since their launch in January. Their introduction broke various ETF records as institutions and traditional investors rushed to invest, leading to a surge in the price of BTC and the creation of a new all-time high.
However, interest in Spot Bitcoin ETFs has declined, with six consecutive days of outflows reported recently. Some argue that the price of BTC has become overly dependent on the activity of these ETFs. Currently, the 11 ETFs collectively own $55.55 billion worth of Bitcoin, representing 4.39% of the total market cap.
Despite the current price volatility, Standard Chartered remains bullish on Bitcoin’s long-term prospects and anticipates significant price increases in the coming years. Their analysis is based on the similarities between Bitcoin and gold, as well as the potential impact of Spot Bitcoin ETFs on the cryptocurrency’s price trajectory. Investors will be watching closely to see if these predictions come to fruition and if Bitcoin can indeed reach the lofty price targets set by Standard Chartered.
