After the Bitcoin halving, the big question on everyone’s mind is: how high can Bitcoin go?
Maybe you wonder where Bitcoin (and rather, the Bitcoin) is headed? Well, it’s in an attempt to explain the way forward that we’re undertaking this Bitcoin price projection, providing near- to long-term predictions for Bitcoin, drawing clues and hints from the asset’s past into conclusions regarding where we’ll end up based on where we’ve already been.
Why is Bitcoin Going Up?
What is the reason behind the price increase? A clear positive trend can be observed for BTC price in 2024.
Halving Fever: The next Bitcoin’s scripted code ‘halving’ of the bitcoin block reward to miners of bitcoin will soon happen. Half of bitcoin’s supply is simply created daily, so halving reduces the rate at which BTC enters the economy. BTC is thus made quite scarce. Scarcity, in economics, is the mother of price. Gold is thought scarce enough in its supply, so we create an impression of scarcity.
Bitcoin on the radar: This is nothing but regulation-sanctioned (for the US by the SEC and others) spot Bitcoin ETF approvals. A market participant making BTC mainstream by providing a legitimate route for common equity owning holders opens engagement of the Bitcoin market to more investors not just directly as a BTC holder but more so as a holder of (publicly traded) BTC holders. Of course, Bitcoin futures have made more inroads than just a route into BTC for paper exposure.
Similar to the Bitcoin futures, dollars flowing through would be bait for more, bringing international dollars into the BTC world, adds liquidity and value. Just like BTC futures drove inflows, expectations of this US-route – SEC-approved Bitcoin ETF – would accumulate dollar inflows into BTC. In that way, water flowing inward, whether from spot or the future, more Bitcoin would flow in.
Yes, the fluctuations of the Crypto market generally, and of the volatile Bitcoin, in particular, are fostering this development. But nobody can see into the future.
Tim Draper’s $250K Bitcoin Prediction
The venture capitalist Tim Draper recently explained his prediction for the BTC price in 2024 in an interview for Coin Bureau.
He told me that, when BTC was priced at around $4,000, he had forecast it reaching $250,000 in four years. ‘What I didn’t expect when I made that call was how scared and how old-thinking the US would be,’ he said. ‘I think if the US was receptive, I’d be sitting here having conversations with the people from El Salvador.’ El Salvador was the first country to make BTC legal tender in addition to the US dollar.
Historical Perspective: Bitcoin Volatility Over Time
In its volatile history, we have been witness to a financial phenomenon, a nascent digital token and a fledgling asset class. It has arced and surged through a rough ride, escaping the sickening depths of the losers’ list and soaring to dizzying heights on the winners’ side. It has fallen victim to infighting, regulatory interference and a steady chorus of naysayers. Yet it has survived, deepening its reach into new corners of the world and attracting a group of true believers, its undiminished allure undiminished.
It has presented investors with far more than another opportunity to potentially achieve a return; it has offered front-row seats to the maturation of an asset that has up-ended centuries-old notions about value and investment. An asset’s maturation can offer a return that investors don’t get while the opportunity is in its formative years. BTC has a lot more growing up to do.
Bitcoin 1.0 – Early days (2011-2017)
Between 2011 and 2017, BTC was in the proof of technology phase: testing the blockchain as a functional entity and in the early stages of experiencing network effects. Its price still swings wildly; immense volatility continues to reign. But those who had a sense of the underlying tech’s long term promise, and who were brave enough to hold on through the volatility, were poised to enter an age of revolution.
Bitcoin 2.0 – Awkward growth spurt (2017-2021)
As it aged through 2017-21 into true toddlerhood, Bitcoin was blowing past proof of existence and into proof of adolescence growth. By this time, BTC wasn’t a Wall Street-side-hustle seduced by a few billionaires and/or Silicon Valley tech bros. Bitcoin’s pitch was drowning the great brains of tens of millions of people across the earth. Not only was it burning through almost all political bans and bounties on the block, but BTC remained spectacularly volatile, just like always.
Except in 2021 it did what it always did and launched to new all-time highs. Moreover, it did not explode like a one-off bubble that would hemorrhage hordes of precious herds from the nascent crypto asset class soon thereafter with subsequent round trips to the swamp. That was it – in our minds, the moment when Bitcoin showed proof of stickiness. Bitcoin was becoming sticky.
Current Trends in Bitcoin’s Market Behavior
It has also served to stabilize the price of Bitcoin and reduce some of its volatility. Prominent price trends reveal important causes of Bitcoin volatility and can help predict future price movements.
Bitcoin 3.0 – Tests of adolescence (2021-2024)
This current journey, however, is that of technological development continuing, an asset being priced by a larger cohort of investors, and with the beginnings of institutional adoption also beginning to reveal themselves. The smaller drawdowns that were supposed to manifest did in fact come to pass, but by quite a bit less than expected. Bitcoin’s ability to weather each of these tests has been an essential narrative element for mass-market adoption, akin to a shell hardening in a lobster’s shell, or chickenpox helping to mature the immune system.
Bitcoin 4.0 – Coming of age (2024-TBD)
By 2024, we expect it’ll be time for Bitcoin 4.0. Following the potential macro clarity from a Bitcoin ETF and other investment vehicles – and the subsequent easing of regulatory ambiguity – we believe Bitcoin is about to officially come of age. The post-ETF period should bring a maturation of Bitcoin, and usher in a wave of retail and institutional investors realizing the potential of BTC as a core portfolio building block.
The fixed supply – there will never be more than 21 million coins – means that Bitcoin is a deflationary asset, and its price swings can be particularly dramatic as demand waxes and wanes.
The mechanisms that will eventually lead us to the 21 million bitcoin cap are called halving.
Since the early days of Bitcoin, the rewards for mining a block of transactions are cut in half every four years or so. In the beginning, miners earned blocks of 50 bitcoins at a time. That reward has halved numerous times and will continue to do so until the last fraction of a coin is mined. About 19.6 million bitcoins exist today, and the cap will not be reached until 2140.
Greater demand from investors, for example, can lead to price increases, especially during economic downturns, whereas lower demand can cause prices to fall precipitously.
Navigating Bitcoin’s Future Volatility
Perhaps most importantly, and as a pull factor, the biggest determinant of change over time, and the greatest driver of returns, is demand for BTC. When the Bitcoin whitepaper first saw the light of day, released to mailing lists (and the world) in late 2008 and associated with the launch of the Bitcoin protocol at the start of 2009, demand for BTC came predominantly from a small group of tech nerds. It was, and remains, hard and painful to acquire, and the markets were small and scarce in using BTC for anything, with little to no merchant adoption at the time.
In 2023, BTC adoption moved from the fringe to the mainstream. Merchant and corporate adoption is exploding, and so are the businesses building infrastructure to help the average person use BTC. The technical infrastructure that users had to wrestle with in the early days to use a Bitcoin wallet, exchange or marketplace has been masked by user-friendly wallets, exchanges and marketplaces.
Even Bitcoin interest among institutional investors is picking up. Hedge funds, asset managers and endowments are increasingly viewing BTC as a store of value and a great diversifier, primarily from the perspective of an uncorrelated asset that might also serve as an inflation hedge. In addition to Block’s $50B of Bitcoin held by ETFs, countries and public and private companies, BTC had another significant institutional milestone earlier this year.
Blockforia.com
Blockforia.com is one of the most popular bitcoin exchanges that lets you buy bitcoin in a straightforward process with many clear ways to buy BTC with your credit card or debit card within minutes. Blockforia EOOD is registered with the National Revenue Agency in Bulgaria under the law of the European Union. Blockforia is a legit website where it is possible to trade buyers and sellers in a secure environment with control over their transactions.
