Standard Chartered, a multinational banking and financial services company, has forecasted that the price of Bitcoin would reach $50,000 this year and $120,000 by the end of 2024. However, this is not the first time the bank has made such a bold claim, having previously forecasted that Bitcoin would hit $100,000 by early 2022.

Standard Chartered Boosts Bitcoin Prediction to $120,000 by 2024

In April, Standard Chartered published a $100,000 price target for Bitcoin by 2024. However, the bank has now updated its forecast, increasing the target price to $120,000 in light of the recent rally in crypto prices, Reuters reported, citing the bank’s top FX analyst Geoff Kendrick.

The bank’s prediction is based on the recent surge in Bitcoin’s price, which has seen its value increase by 80% since the beginning of the year. Standard Chartered argued that this jump in price could incentivize Bitcoin miners to hoard more of their mining rewards.

Kendrick explained that increased miner profitability per Bitcoin mined would allow them to sell less while maintaining cash inflows. This reduction in net Bitcoin supply would then push prices higher.

Kendrick estimated that miners have been selling 100% of their new coins. However, if the price reaches $50,000, they would likely only sell 20-30% of their supply. This reduction of net Bitcoin supply could drastically decrease the number of coins sold daily, from 328,500 to a range of 65,700-98,550.

“It is the equivalent of miners reducing the amount of bitcoins they sell per day to just 180-270 from 900 currently,” he reportedly said, noting that such a sharp drop could lead to a supple squeeze and a subsequent rise in demand.

It is also worth noting that Bitcoin halving, when the reward for Bitcoin mining is cut in half, is scheduled for April 2024. With fewer new coins being minted, the existing supply becomes even more scarce and could drive higher prices.

Standard Chartered’s Previous Crypto Forecasts Were Dead Wrong

Standard Chartered had also made predictions of sky-high valuations for Bitcoin during previous rallies. For instance, in 2021, the bank predicted that the Bitcoin price would hit $100,000 by early 2022 and could be worth as much as $175,000 longer-term.

At the time, the bank also said it “structurally” valued Ethereum, the second-most traded crypto asset, at $26,000-$35,000. “As a medium of exchange, bitcoin may become the dominant peer-to-peer payment method for the global unbanked in a future cashless world,” Standard Chartered wrote.

However, in contrast to the optimistic forecast, the leading cryptocurrency closed last year at $16,500, down about 65%. Both Bitcoin and Ethereum also failed to top their previous cycle highs for the first time by year-end.

In 2021, it was also reported that a Standard Chartered unit planned to establish a cryptocurrency brokerage and exchange platform in Britain and Europe. “We have a strong conviction that digital assets are here to stay and will be adopted by the institutional market as a highly relevant asset class,” Alex Manson of SC Ventures said back then.

Nevertheless, while Standard Chartered’s forecast is optimistic, it is crucial to approach such predictions cautiously. The volatility and unpredictability of the cryptocurrency market make it challenging to accurately forecast future prices, as evident from previous forecasts by Standard Chartered and other financial institutions.

The post Standard Chartered Calls for $120k BTC in 2024, But it Has Been Wrong Before appeared first on Tokenist.

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