Bitcoin might just soar to a whopping $120k by 2024's finale. That's what the big brains at Standard Chartered Bank are saying. Th0se outside of the UK may not understand exactly who that is, but this bank is massive here, with 85,000 employees and locations across the country.
They reckon Bitcoin's recent price bump could have the so-called 'miners' - the folks who dig up these digital coins - stashing away more than they're selling.
Back in April, the same bank forecasted Bitcoin could hit $100k by 2024, thinking we were out of the dreary 'crypto winter'. But now, the bank's head of crypto reasearch, Geoff Kendrick, says there's even a 20% chance it could go beyond that.
Why's that? Well, Kendrick explains, with every Bitcoin they mine being more valuable, miners can sell fewer of them and still keep the cash flowing in. This means less Bitcoin in the market, pushing the price even higher. Simple supply and demand.
Bitcoin's had a strong year, rocketing up 80%...
But at the current price of $30k and change, we're till a far cry from the record $69k it hit last November.
2022 was rough, with heaps of dollars wiped off the sector as central banks got tough with interest rates and big crypto names like FTX exchange crashed and burned. But surprisingly, this year's failure of some old-school banks has actually helped crypto bounce back.
The bank thinks the predicted price hike is because Bitcoin miners, who create about 900 new Bitcoins a day globally, might soon need to sell less of their stash to cover their costs - mostly the electricity needed to power their monster computers.
The More Bitcoin is Worth, the Less Miners Sell to Cover Costs...
According to Kendrick, miners are currently selling all their newly minted coins. But if the price reaches $50k, they'd probably only need to sell 20-30%. So instead of flogging 900 bitcoins a day, they'd only be selling between 180 and 270.
"Over a year, that's like reducing the number of coins miners sell from 328,500 to somewhere between 65,700 and 98,550 - meaning about 250k less Bitcoins flooding the market each year," Kendrick explains.
And in another twist, come next spring, the total number of Bitcoins that can be mined each day is set to halve. It's part of Bitcoin's in-built design to limit the supply and keep its appeal.
But let's not forget that Bitcoin has a history of wild price guesses. Back in November 2020, a Citi analyst said Bitcoin could climb as high as $318k by the end of 2022. It ended up closing that year down about 65% at $16,500. So take all these predictions with a pinch of salt.
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