In December 2022, analysts from Standard Chartered presented a less-than-encouraging forecast for the cryptocurrency market in 2023. However, following Bitcoin's remarkable surge from $16,000 to $30,000, the experts at Standard Chartered decided to reassess their prediction.
In the first four months of this year, the entire cryptocurrency market experienced a significant surge. Analysts at Standard Chartered believe that the prolonged crypto winter has finally ended. They anticipate that the oldest cryptocurrency has the potential to reach the impressive milestone of $100,000 by the close of 2024. If BTC continue its positive momentum, it is likely to uplift the entire crypto market.
According to the analysts, Bitcoin holds promising prospects. Several factors contribute to this positive outlook, including recent disruptions, instability in the banking sector, and a stabilization of demand for high-risk assets. The stabilization is partially attributed to the conclusion of the U.S. Federal Reserve’s cycle of interest rate hikes. Furthermore, the increased profitability of cryptocurrency mining has also contributed to the upward trend in the value of digital assets. These insights were shared in a note penned by Geoff Kendrick, Head of Digital Assets Research at Standard Chartered.
While sources of uncertainty remain, we think the pathway to the USD 100,000 level is becoming clearerKendrick wrote
Bitcoin has experienced significant growth this year. In April, BTC surpassed the $30,000 milestone for the first time in the past ten months. The rise in market capitalization and profitability indicates a partial recovery after trillions of dollars were wiped out from the cryptocurrency market in 2022. Factors contributing to this decline were the interest rate hikes by central banks and a series of bankruptcies among cryptocurrency companies.
It's worth noting that grandiose predictions for cryptocurrencies have been a common occurrence, even during the previous Bitcoin bull run. In November 2020, an analyst from Citibank suggested that Bitcoin could potentially reach $318,000 by the end of 2022. However, by the end of last year, its price plummeted by nearly 65%, with BTC hitting around $16,500.
According to the analytical note by Standard Chartered, Bitcoin once again proves its value as a “branded safe haven, a perceived relative store of value and a means of remittance”.
Kendrick also believes that the endorsement of the first version of the MiCA regulations by the European Parliament regarding the regulation of crypto asset markets in the European Union could provide further momentum for Bitcoin and other cryptocurrencies. This statement may spark some debate, but it is mentioned in the analytical note.
Most cryptocurrency market analysts believe that Bitcoin will once again be positively impacted by the upcoming halving event. This event is set to occur in just a year, in April 2024, and will result in a halving of miner rewards. Historically, this reduction in supply has led to a period of price growth, typically lasting 1-1.5 years, and reaching a new all-time high (ATH). The market is hopeful that this cyclic effect will once again manifest.
Now, let's turn our attention back to Standard Chartered and their current forecast. It is quite remarkable considering its contradiction to their previous forecast released in December 2022, which we have already shared with our readers. Just as a quick reminder, back then, Eric Robertson, the Chief Strategist of Standard Chartered, presented an analytical note addressing investors. He predicted challenging times for cryptocurrencies, a 70% decline in Bitcoin's value, and an increased investor interest in physical gold. While his gold prediction turned out to be accurate, his forecast for cryptocurrencies and Bitcoin, in particular, has proven to be completely off the mark. In fact, over the span of just four months in 2023, Bitcoin has surged in value by an impressive 90%.
