‘Persistent inflation’ will be key in Bitcoin’s run to $200K — Crypto fund manager

Bitcoin price has surged throughout 2024, fueled by the launch of several spot exchange-traded funds (ETFs) and the asset’s fundamental role as a store of value. 

The interest in Bitcoin (BTC) is expected to persist, particularly as the United States government’s continued high spending and interest rate policy discussions prevail, suggested Grayscale’s research director, Zach Pandl.

“We expect persistent inflation and unsustainable budget deficits to contribute to continued demand for store-of-value assets, like Bitcoin,” Pandl told Cointelegraph.

Predicting the future value of Bitcoin remains challenging due to the multiple underlying variables in play, yet Jupiter Zheng, partner at HashKey Capital’s liquid fund, sees significant potential for growth, suggesting that Bitcoin could possibly hit $200,000 by the end of the year.

“Low prediction will be $100,000, medium one is $140,000, and high prediction is $200,000, by the end of 2024,” Zheng explained in an interview with Cointelegraph.

The positive impact of ETFs on the cryptocurrency market has made crypto investments more accessible and appealing to a broader audience. Over the long term, Bitcoin’s price behavior will start to mirror that of traditional assets such as equity and gold. This could potentially lead to more stable growth and integration into mainstream investment portfolios, he added.

The bullish case for BTC

Venture capitalist Tim Draper has predicted that BTC will triple in value in 2024 due to the inflows into ETFs and the impact of the Bitcoin halving.

Draper expressed optimism about Bitcoin’s trajectory in an interview with Cointelegraph at Paris Blockchain Week, reflecting on his earlier predictions and suggesting a possible rise to $250,000 by year’s end, given the positive signs he observes in the market.

The introduction of spot Bitcoin ETFs in the United States has significantly revived interest and capital investment in Bitcoin. The investment products have opened up a new avenue for Bitcoin-curious investors who might be daunted by the prospect of holding BTC in self-custody and serve as a hedge against devaluing fiat currencies, Draper added.

Even in the worst-case scenario, it’s not too late to buy Bitcoin

While historical halving events offer some insight, the current situation presents a novel scenario, with ETFs introducing more volatility to crypto prices due to fluctuating demand.

Bitcoin’s recent volatility suggests that the market is adjusting to new supply and demand dynamics, particularly with the global introduction of spot ETFs that could significantly increase Bitcoin’s demand in the upcoming months, potentially driving up its price.

Related: $250K Bitcoin? Tim Draper says halving, Bitcoin ETFs will drive demand

On the flip side, these investments could cost more volatility, as investors can move in and out of funds more easily than they can with self-custody.

Zheng said:

“Our current model price is $90,000. A more bullish scenario is $125,000, and a bearish one is $50,000.”

“The key factors are the spot BTC ETF net inflows (as a measure of TradFi adoption process), the Fed interest cut late this year, the 2024 BTC halving (creating more imbalance of demand and supply),” he added.

While predicting the precise value of BTC by the end of 2024 is difficult, there is consensus among experts that its price is likely to see an upward trajectory throughout the year. These predictions are based on the expectation of high inflows into the Bitcoin ETFs, the asset quality as a store of value, and the current macroeconomic conditions.

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