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(Kitco News) – As Bitcoin sees strong price gains ahead of the new year, the leading cryptocurrency could be poised for another big rise, with one bank expecting prices to more than double from current levels by the end of 2024.
Bitcoin’s fortunes began to turn in early October as expectations grew that the Securities and Exchange Commission would approve the first spot Bitcoin exchange-traded fund (ETF) in the United States. In a recent report, Geoff Kendrick, head of foreign exchange and digital assets research at Standard Chartered, said the eventual approval of the long-awaited Bitcoin ETF could trigger further price increases.
The bullish comments come as Bitcoin prices have more than doubled since their September lows of around $25,000 per token. The digital currency was last traded at just under $43,000 per token.
In his 2024 outlook, Kendrick reiterated his call for Bitcoin prices to rise to $100,000 next year.
“We expect a number of spot ETFs for both BTC and ETH to be approved in the first quarter of 2024, paving the way for institutional investment,” the analysts said in the report.
“We now expect there to be more price upside ahead of the halving than before, particularly with the earlier-than-expected launch of US spot ETFs. This suggests that there is a risk that the $100,000 mark could be reached before the end of 2024,” they say added.
As prices continue to rise in the new year, Kendrick expects demand to outstrip the supply of minted digital coins. He noted that higher prices mean cryptocurrency miners do not need to release as many coins to the market.
The team found that almost all Bitcoins mined in the second quarter were sold, but this trend is expected to change in the first quarter of next year.
“If the BTC price averages $50,000 by the first quarter of 2024, as we predict, the ‘BTC minus all cash costs’ calculation would increase to $30,000,” he wrote. “On this basis, selling just 27% of the BTC mined in the first quarter of 2024 would generate the same absolute level of excess cash as selling 100% in the second quarter of 2023.”
According to the report, selling just 27% of mined coins in the next quarter would reduce the net supply of Bitcoin by around 250,000.
At the same time, the halving event, which is expected to take place in April, will further restrict the supply of Bitcoin for potential investors and will also likely drive up prices.
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Source : www.kitco.com