As the market’s dismal atmosphere fades and traders come back in, the price of Bitcoin, the most actively traded cryptocurrency, has surged by approximately 160% this year, reaching a 20-month high of $44,300 on December 9.
Now that the harshest regulatory penalties have passed, traders are placing bets that big international fund managers and investment banks will accept the crypto.
The cryptocurrency market, which is infamous for its booms and busts, is bouncing back after two years of negativity and losses. At the beginning of this year, the value of bitcoin had dropped by three quarters from its peak of slightly over $69,000 in November 2021 to just $16,000.
Bitcoin Shows Mettle
After losing more than 15% of its weekly gains for holders, the largest cryptocurrency in the world by market capitalization, bitcoin’s price was trading sideways on Friday, near $43,500.
Today, investors are betting on growth companies and riskier assets in the hopes that central banks would start lowering interest rates next year, which is why bitcoin and other cryptocurrencies are surging.
The expectation surrounding the introduction of Spot Bitcoin ETFs and the institutional adoption of crypto are two factors driving the price of BTC in tandem with expectations of a reduction in interest rates.
This is also in line with predictions made by Standard Chartered, the largest bank in the UK, which states that the crypto may reach $120,000 by the end of the year.
BTC market cap currently at $867 billion. Chart: TradingView.com
“This will be the first time there could be true recognition of bitcoin … I do think this signifies that, this time, the rally will be more sustained,” James Butterfill, head of research at investment group CoinShares, said.
Web3 investor and cryptocurrency expert CredibleCrypto predicts that in the third week of December, the price of BTC will probably continue to rise and reach the $50,000 mark.
Crypto Analysts Eye $50,000 Price Target
The analyst claimed that regardless of whether the price of Bitcoin breaks the $42,000 lows or not, the asset is likely to fetch $50,000 early this month, pointing out the addition of $30 million in spot bids.
Analysts at CryptoQuant predict that in the first few months of 2024, Bitcoin’s target price may fall between $50,000 and $53,000.
“Bitcoin may be targeting $50,000 to $53,000 based on the network activity valuation perspective,” they said.
BTC price action. Source: CryptoQuant
Experts analyzed the price of the alpha coin across short time horizons, predicting a correction due to a dearth of buyers on the spot market. They contended that a major change in circumstances is required before the price of BTC rises to $50,000 or more.
Image: Freepik
Some perceive the commencement of a novel “super cycle.” Last month, Bernstein, the American investment bank, made a forecast stating that the value of BTC might increase by over three times, reaching $150,000 by the year 2025.
Analysts reached the conclusion that supports their findings after closely examining elements including market capitalization, user activity on the Bitcoin network, and the amount of transactions related to Bitcoin.
These crucial indicators provide insightful information about the general well-being, activity, and vigor of the crypto ecosystem, which helped to create a thorough picture of the cryptocurrency’s present position within the broader financial system.
Featured image from Brookings Institution