Bloomberg analysts say the Bitcoin price (BTC) and other cryptocurrencies may be about to explode. BTC currently hovers below the $29,000 mark, while Ethereum (ETH) is below $2,000.
An upcoming surge will encourage investors who saw their assets move slowly in recent months, the report mentioned.
The recent rally in cryptocurrencies encouraged some analysts to predict that Bitcoin’s price will continue to rise this year. In fact, BTC already gained more than 80% in recent months, outperforming the price of gold and the Nasdaq 100 and S&P 500 indexes.
BTC increased in price for the last four months in a row.
Historically, Bitcoin grew by more than 200% each time its value increased for four consecutive months. So, if history repeats itself, “we may see Bitcoin’s price rise above $105,000,” Bloomberg analysts say.
Is Bitcoin’s rise imminent?
The report also cited other analysts who are optimistic about a rise in the price of Bitcoin.
Last week, analyst firm Standard Chartered wrote that BTC could reach $100,000 in the near future. It pointed to the banking crisis and the fact that cryptocurrency is seen as a digital alternative to gold.
Another Bloomberg Intelligence analyst predicted that BTC will rise to a price of $50,000. After that, the price could even rise to $185,000 if investors were to allocate just 1% of the global bond market to the coin.
For its part, investment firm CMC Invest pointed to the fact that liquidity data shows positive results for the industry.
“The great thing about cryptocurrencies is that it’s a lightning rod for liquidity. And when liquidity returns to the market, and we are seeing it, I think cryptocurrencies will continue to trade well,” the firm’s report highlighted.
But why would the price of BTC rise?
Bloomberg analysts mention several scenarios that could favor a rise in the price of Bitcoin.
First, there are fears that the banking sector will implode. On Monday, First Republic Bank failed, becoming the second largest bank to fail in the United States. Other banks that have failed this year include Credit Suisse, Silicon Valley Bank, Signature Bank, and Silvergate Capital.
There are also fears that other U.S. banks may also fail due to their exposure to the commercial real estate sector. In addition, many regional banks maintain low-interest rates that have become unprofitable in a period of high policy rates.
Second, there is optimism about the Federal Reserve (FED). At this week’s meeting, the Fed could take into account the vulnerability of the banking sector and decide to leave interest rates unchanged or raise them by just 0.25% and then take a strategic pause in rate hikes.
Third, Bitcoin is close to an upcoming halving of the mining reward, or halving, which will take place in 2024. In most cases, cryptocurrency prices rise prior to this event.
Other positive catalysts for the BTC price are its scarcity, its stability over the years, and the fact that the regulatory landscape is becoming clearer. Last month, the European Parliament voted in favor of the entry into force of MiCA, the first set of cryptocurrency regulations across the European Union (EU).
The price of Bitcoin stood at $28,362 on Wednesday, down slightly by 0.83% in the last 24 hours (16:38 UTC). BTC accumulated weekly losses of over 4%.
Follow us on our social networks and keep up to date with everything that happens in the Metaverse!
Twitter Linkedin Facebook Telegram Instagram Google News
