BTC is expected to reach $450,000 by 2025?

Niti998

The Bitcoin rainbow chart indicates an accumulation of BTC signals. Predictive models and analysts forecast a significant increase in BTC in the coming months.

Bitcoin (BTC) saw an increase of over 68% in the first quarter of 2024, but the headwinds in the second quarter eroded some of the gains. With Bitcoin dropping by 7% in the second quarter and hovering in the price range of $60,000 to $71,000, it's crucial to use the Bitcoin rainbow chart to gauge whether it's overvalued or undervalued.

Calculating from the beginning of the year until now, BTC has increased by over $22,000, resulting in a return rate of 50.3%. However, adverse factors in the second quarter, including concerns about interest rates and tensions in the Middle East, spooked investors, explaining the withdrawals last week.

Now that Bitcoin has rebounded to over $66,000, the big question is whether it's too expensive or currently undervalued?

The Bitcoin rainbow chart signal is "accumulation."
According to the Bitcoin rainbow chart, the current price level of Bitcoin is within an area called "accumulation."

The Bitcoin rainbow chart intuitively depicts Bitcoin valuation based on historical data. It's worth noting that it's on a logarithmic scale, including color bands indicating buy (blue, green) and sell (orange, HS) areas.

In the past three halving cycles, BTC has been severely undervalued immediately after halving. Although the current BTC price level is slightly higher in scale than the previous cycle, it's within the "accumulation" zone.

Thus, according to the Bitcoin rainbow chart, Bitcoin is still undervalued and not overheated.

Additionally, the stock-to-flow (S/F) model suggests that Bitcoin's price has greater upward potential. The model evaluates BTC's future price by dividing the circulating supply of BTC by the number of coins mined annually.

The model has been able to predict BTC prices reasonably well in the past with a reasonable variance. The company predicts that BTC will break $100,000 in the third quarter of 2024 and surpass $450,000 by the end of 2025.

However, considering the new U.S. spot BTC ETF factors and macro pressures, cross-referencing S/F predictions with nuanced expert analysis can also provide crucial insights.

Why analysts believe BTC can reach $200,000 in 18-24 months
Interestingly, Standard Chartered Bank predicts that Bitcoin could reach $200,000 in the next 18-24 months.

In a recent interview, Standard Chartered Bank's Director of Digital Assets Research, Geoff Kendrick, believes that the maturity of the spot BTC ETF is a driving factor;
"I expect as we mature into the ETF market in the U.S. from the beginning of this year, you'll get flows of $50-100 billion. So far, we've got $12 billion. That might be realized in 18-24 months."

Kendrick associates BTC ETFs with gold, noting that when its ETF flows matured, gold prices increased 4.3 times. According to Kendrick, if BTC ETF maturity follows gold's trajectory,
"This could take us to a range of $150,000 to $200,000."

Similarly, in mid-March, Bernstein analysts revised their BTC price forecast from $90,000 to $150,000 by mid-2025, citing the spot BTC ETF flow "exceeding expectations."

CryptoQuant founder Ki Young Ju stated that "new whales" have now doubled their BTC accumulation frenzy.
"The initial investment of the new whales in #Bitcoin is almost twice the total accumulated investment of the old whales."

However, significant whale demand is not the only good news for BTC's future price. The macro outlook remains consistent.

BitMEX co-founder and Maelstrom CIO Arthur Hayes predicts a favorable summer for BTC due to the "sovereign bond market" issue. In a recent blog post titled "Left Curve," the CIO pointed out;
"In the market, few do the things that will take you from zero in 2009 to $70,000 in 2024 (Bitcoin), and even fewer can do it (Bitcoin reaching $1 million). However, as the sovereign debt bubble begins to burst, leading to an increase in fiat currency liquidity, the macro environment only becomes more evident."

This CIO accurately predicted last week's massive sell-off, citing U.S. tax season and the Bitcoin halving.

Although tensions in the Middle East also played a role in last week's withdrawals, Hayes' forecast suggests that Bitcoin's macro outlook looks promising starting from the summer.

977Iti

It's also reasonable to believe in this, isn't it?

Ritu77

The likelihood of such a price seems unlikely, doesn't it?

Samiksha

It seems there's no doubt that this can be achieved.

Ritu13

Bitcoin still has the potential to reach that level.