The biggest cryptocurrency, Bitcoin (BTC), is expected to rise dramatically, according to analysts’ price projections. Several variables have the potential to push the price of Bitcoin beyond $100,000 during the 2024–2025 bull run. So, let’s take a closer look at the seven reasons why the price of bitcoin might reach $100,000 by 2025.
Seven Arguments for Bitcoin to Reach $100,000
- Institutional Engagement via Spot ETFs for Bitcoin
With Spot Bitcoin ETFs, institutional investors are adopting Bitcoin aggressively. These funds now hold 3.3% of the whole Bitcoin supply. Furthermore, big banks like BlackRock have been steadily increasing the amount of Bitcoin that they own in their exchange-traded funds. This infusion of institutional money gives Bitcoin legitimacy and adds a substantial amount of liquidity to the market, increasing its scarcity and driving up its price.
2. The Historical Correlation Between Bitcoin Prices and Halving Events
It’s interesting to observe the historical behaviour of the price of Bitcoin following halving events. There are just 48 days left until the next halving in 2024, so anticipation is strong. Analysing historical data reveals the significant impact that previous Bitcoin price halving events have had. After the Halving in 2012, the price of Bitcoin shot up from $12 to an incredible $1,200. The price of Bitcoin peaked in 2016 before the notorious “Crypto Winter” began, rising from $650 to an astounding $19,000 during the Halving. In a similar vein, the 2020 Bitcoin Halving set off an incredible surge that saw the price soar from $9,000 to an all-time high of almost $68,000. This tendency is expected to continue with the upcoming halving, which will lower mining rewards from 6.25 BTC to 3.125 BTC by creating scarcity in the market.
3. FASB Rule Driven Corporate Adoption
The Financial Accounting Standards Board (FASB) regulation is one of the latest factors driving corporate use of Bitcoin. since of this regulation, businesses have been more inclined to hold Bitcoin in reserve since they understand its worth as a store of capital and its potential for long-term development. A growing number of businesses are using Bitcoin as a strategic asset as they diversify their holdings.
4, Central Banks Using Bitcoin To Counteract Inflation Using Fiat
Globally, countries and central banks are using Bitcoin as a hedge against economic uncertainty and inflation. This tendency is best shown by El Salvador’s audacious decision to accept Bitcoin as legal cash. Furthermore, given the difficulties facing conventional fiat currencies, Bitcoin becomes a valuable tool for hedging against the possibility of national currency depreciation. There’s no doubt that the growing acceptance will contribute to its enhanced worth.
5. Bitcoin Price May Rise Due to Fed’s Anticipated Rate Cuts
It is anticipated that in June of this year, the Federal Reserve would lower interest rates. Investors are predicted to look for alternate repositories of wealth more and more as the Fed’s rate policy shifts. Due to its limited quantity and decentralised structure, Bitcoin stands out as a desirable alternative asset. It’s because, from the perspective of investment, borrowing capital would be less expensive. As a result, investors might take advantage of the chance to buy riskier assets like cryptocurrency. Furthermore, as the most popular digital currency, Bitcoin has gained a great deal of reputation over time, which may encourage more people to use it in the event that the Fed cuts interest rates.
6. Using Bitcoin to Heed Inflation
The allure of Bitcoin as a hedge against inflation is only increasing. Individual individuals, as well as nations and institutional investors, are looking for solutions to protect themselves from inflation. Due to its limited quantity and decentralised structure, Bitcoin is a desirable choice for asset preservation in the face of inflationary threats. This would cause inflows to increase, which would raise the price of bitcoin.
7. Bitcoin Price Is Anticipated To Follow Gold’s Movement Following the 2003 ETF Launch
It is anticipated that the Bitcoin Spot ETF would bring billions of dollars into the market, simulating the effect of gold. The ETF’s enhanced liquidity is probably going to boost interest in Bitcoin. If the price movement of gold is similar to what happened in 2003, this might push its price to above $100,000 by the following year. Gold Bullion Securities, the first-ever Gold ETF, debuted on the Australian Securities Exchange on March 28, 2003. Gold was valued at $330.30 an ounce at the time. According to Bullion by Post, its value increased to $421.25 oz in less than a year, indicating a year-over-year gain of more than 27%. This is much more than existing patterns, considering that the price of gold increased by 13% in 2023.
With over four years of immersive experience in the crypto industry, Nick is a seasoned crypto writer dedicated to unraveling the complexities of blockchain technology and decentralized finance.
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