A recent research report by Standard Chartered Bank, a prominent financial services institution based in the UK, reveals that it has revised its Bitcoin prediction for the coming years. The bank now anticipates that Bitcoin’s price will surge to $120,000 by the end of 2024, up from its previous forecast of $100,000 made in April. Furthermore, the bank predicts that Bitcoin could reach $50,000 by the end of 2023.
One of the key factors driving this optimistic projection is the increasing profitability of Bitcoin miners. Standard Chartered explains that as the miners mint approximately 900 new Bitcoins daily worldwide, they will soon need to sell fewer coins to cover their operational costs, primarily electricity expenses required to power their mining equipment.
Now, let’s delve into the performance of Bitcoin during the first half of 2023, examining the price volatility and recovery that transpired in the cryptocurrency market leading up to this latest forecast.
A comprehensive overview of the period spanning from January to July 2023 unveils notable price fluctuations in Bitcoin, underscoring the inherent volatility and unpredictability associated with the world’s largest cryptocurrency.
The year commenced on a positive note for Bitcoin as it continued the upward trend that began in the previous year. During January, the price experienced a steady climb, surpassing new all-time highs above $60,000. This upward momentum was fuelled by the growing interest from institutional investors and positive regulatory developments in certain jurisdictions. By February, Bitcoin briefly touched the $70,000 milestone, further solidifying its position as a mainstream asset class.
However, the exuberance was short-lived as the market witnessed a substantial correction. Bitcoin encountered a steep decline, with prices plummeting by over 30% from their February peak. This correction was primarily attributed to profit-taking, heightened regulatory scrutiny, and concerns regarding the environmental impact of Bitcoin mining. Consequently, investors approached the market with caution as calls for stricter regulations in major economies grew louder.
Following the market correction, Bitcoin embarked on a gradual recovery. The price stabilised in May, leading to a period of consolidation. Market sentiment improved as regulatory concerns eased, and investors recognised the long-term potential of digital currencies. Notably, Bitcoin displayed its resilience by remaining above the psychological support level of $40,000 throughout this phase.
With the arrival of July, Bitcoin experienced a resurgence in both price and investor sentiment. Several positive catalysts contributed to this renewed optimism. Institutional adoption of cryptocurrencies continued to expand, with an increasing number of companies and financial institutions integrating digital assets into their operations. Additionally, favourable regulatory developments, including clear guidelines and enhanced oversight, bolstered market confidence. Bitcoin once again surpassed the $50,000-mark, reigniting hopes of another sustained bull run.
The first half of 2023 witnessed significant volatility but also promising recovery for Bitcoin. Despite the market correction in March and the regulatory concerns that cast a shadow over the cryptocurrency, Bitcoin exhibited resilience and regained momentum. The renewed optimism and positive catalysts in July helped restore investor confidence, propelling the price higher. Year-to-date, Bitcoin has appreciated by 84%, climbing from $16,547 on January 1st to $30,455.
Standard Chartered Bank’s latest report projects a bright future for Bitcoin, with its predicted price target of $120,000 by the end of 2024. While the cryptocurrency market has experienced notable volatility in the first half of 2023, Bitcoin has highlighted its ability to recover and gain momentum. As the industry continues to evolve, factors such as increased miner profitability and favourable regulatory developments could contribute to the anticipated appreciation in Bitcoin’s value.
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