Major Bank U-turns on Bitcoin With $100,000 Price Prediction
In a recent note published on April 24, Standard Chartered analysts predicted that Bitcoin prices will climb to $100,000 by the end of 2024. This is a significant U-turn for the bank, which in December 2022 predicted that Bitcoin prices would fall to $5,000 in the wake of the FTX collapse.
The collapse of several U.S. banks, including Silicon Valley Bank, Silvergate, and Signature, has solidified the case for Bitcoin as a “decentralized, trustless, and scarce digital asset,” according to Standard Chartered analyst Geoff Kendrick. Kendrick noted that the current stress in the traditional banking sector is highly conducive to Bitcoin’s outperformance.
The Bear Market is Over
Kendrick was confident that the bear market was over and prices would continue higher next year in the next bull market cycle.
“We see the potential for Bitcoin (BTC) to reach the USD 100,000 level by end-2024, as we believe the much-touted ‘crypto winter’ is finally over.”
Stablecoin woes and shrinking supplies have also benefited Bitcoin. This month, an outflow of stablecoins into BTC has been seen as the asset reached a ten-month high of roughly $31,000. Kendrick predicted that Bitcoin market dominance would also return to the 50-60% level. It is currently 47.37%, according to Tradingview, having fallen back 3% over the past couple of weeks.
Federal Reserve Monetary Tightening
Speculation that the Federal Reserve will ease monetary tightening further means the “pathway to the USD 100,000 level is becoming clearer,” Kendrick added.
In his report, the analyst also noted a benefit to Bitcoin mining firms which have seen stock prices surge in 2023.
“The associated price jump – from below USD 20,000 before the SVB issues to above USD 30,000 – has dramatically increased the profitability of Bitcoin mining companies.”
Kendrick concluded that the broader backdrop for risky assets such as BTC is improving.
“While BTC can trade well when risky assets suffer, correlations to the Nasdaq suggest that it should trade better if risky assets improve broadly.”
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Filed under: Bitcoin - @ April 26, 2023 8:29 am