Standard Chartered Projects Bitcoin $BTC To Reach $120K by 2024

Standard Chartered Projects Bitcoin $BTC To Reach $120K by 2024

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In its latest research report, Standard Chartered Bank has presented an optimistic forecast for Bitcoin, suggesting that the leading cryptocurrency could touch the $50,000 milestone by the end of 2021, and climb to an impressive $120,000 by 2024's close.

Mining Economics Fueling Bitcoin's Potential Ascend

Driving this prediction is a key factor: the growing profitability of Bitcoin miners. As Geoff Kendrick, the head of FX and digital assets research at Standard Chartered, explained in the report, miners play a vital role in determining the net supply of the newly minted cryptocurrency, on top of their responsibility of maintaining the Bitcoin ledger.

"Increased miner profitability per BTC (bitcoin) mined means they can sell less while maintaining cash inflows, reducing net BTC supply and pushing BTC prices higher," Kendrick stated.

According to Standard Chartered's report, the primary driving force behind its predicted Bitcoin price surge involves Bitcoin miners. These miners create approximately 900 new Bitcoins globally every day. The costs they incur, predominantly power expenses for high-performance computers, are currently being offset by selling 100% of these freshly minted coins, as per the bank's estimation.

However, should Bitcoin's value climb to $50,000, Standard Chartered believes miners would only need to sell between 20% and 30% of their new coins to cover their costs. This reduction in the number of new coins entering the market could potentially limit the available supply, thereby driving prices up.

A surge in miner profitability per Bitcoin mined means miners are under less pressure to sell their output. This shift allows miners to retain their earnings while simultaneously decreasing the net Bitcoin supply, creating a favorable environment for Bitcoin prices to rise.

Forecast Revision, Shifting Market Conditions

This recent revision is a significant upgrade from the bank's previous forecast in April, which projected Bitcoin hitting $100,000. According to Standard Chartered, this initial prediction, influenced by several factors including a banking-sector crisis, now appears "too conservative."

Since then, the market conditions have shifted notably. Bitcoin has experienced an 80% increase from the start of 2021 and is currently trading around $30,100, triggering the bank's reconsideration of its initial forecast.

In light of the revised projection, it's clear that financial institutions are adapting their strategies and outlooks in response to the highly dynamic cryptocurrency market, underscored by the recent flurry of institutional interest and significant price movements.

As the sector continues to transform, these expert forecasts offer valuable insights into potential trends and fluctuations. However, investors and market observers should approach these predictions with a keen awareness of the broader context — the cryptocurrency market's intrinsic volatility and unpredictability.

At the time of writing, the current trading price of Bitcoin, at around $30,200, represents an 80% increase since the start of 2021, which is an important consideration when gauging the potential future trajectory of this premier cryptocurrency.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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