Bitcoin could reach $180,000 in 2024: Fundstrat

The supply and demand dynamics of bitcoin (BTC) suggest that the asset could soar to $180,000 by April 2024, according to a research note from Fundstrat on Monday.

The forecast – which comes ahead of the next US central bank meeting – largely hinges on the bitcoin spot ETF being approved in the United States, which the market research firm suspects will destroy BTC’s current price balance.

impact of bitcoin etfs

Currently, Fundstrat seeks out The daily demand for bitcoin is about $25 million – about the same amount of new coins put into circulation by miners every day.

“This (Bitcoin ETF launch) will bring daily demand to $125 million, while daily supply is only $25 million,” wrote Tom Lee, head of research at Fundstrat. “The underlying equilibrium price would need to increase so that daily supply matches daily demand.”

“Equilibrium analysis suggests a clearing price of $140,000 to $180,000 before the April 2024 halving,” Fundstrat added.

“Halvening” (another way to refer to a bitcoin halving) occurs when the bitcoin network halves its BTC emissions per block. This event happens once every four years, and the following year consistently sees major crypto market booms.

In the next halving, the emission of bitcoin will increase from 6.25 BTC to 3.125 BTC every ten minutes. While researchers at Coinbase suggest that this may not lead to another uptrend, analysis by Fundstrat suggests that even a halving would not be necessary to reach new all-time highs.

This bullish outlook is largely shared by Standard Chartered Bank, whose analysts predict bitcoin will reach $120,000 before 2025, attributing it to miners hoarding their newly created coins in the medium term.

Meanwhile, Bloomberg ETF analysts Athanasios Sarofagis and James Seifert estimated this month that based on the success of the much smaller Canadian market, the Bitcoin Spot ETF could garner $54 billion in capital over time.

Fed’s upcoming meeting

Fundstrat’s prediction comes days before the next Federal Open Markets Committee (FOMC) meeting, when the Federal Reserve is expected to raise its target interest rate by up to 25 basis points. Stocks and bitcoin are both up for the year despite the Fed’s frequent rate hikes, and hopes of an impending recession on the decline,

It’s surprising to me that our institutional clients have been willing to short whenever the market has been volatile this year

– There is no “Buy the Dip”
– Likely when the decline in inflationary pressures is more pronounced
– Because #irrigated may eventually soften @fs_insight

– Thomas (Tom) Lee (not drummer) FSInsight.com (@fundstrat) 25 July 2023

Fundstrat’s Lee estimates that tomorrow’s announcement will increase the stock price by 1%, and believes that institutions should not expect any major market correction anytime soon.

“We’re still in a situation where people are bearish and ready to sell,” Lee told CNBC’s Squawk Box. “Nobody is really accepting this as an emerging new bullish market.”