Bitwise Analyst: $BTC to Hit $100K by Year-End and $200K by 2025

KEY TAKEAWAYS

• Bitcoin ($BTC) price stabilized between $90K and $93K following Donald Trump's victory.
• Beyond the US, multiple countries are rumored to be quietly acquiring $BTC.
• A strong altcoin rally, with 60% outperforming $BTC, indicates heightened market risk tolerance.

The price of $BTC stabilized between $90K and $93K after Donald Trump's victory. Andre Dragosch, Head of Research for Europe at Bitwise, said that the strategic $BTC reserve initiative in the US is one of the main drivers of this movement.

Last week, the debate over the US $BTC strategic reserve intensified, and Polymarket showed the odds of a national $BTC reserve surpassing 50%.

Several appointments in the new administration openly supported the initiative, and Pennsylvania even introduced new legislation regulating the matter. Over ten states are preparing similar legislative proposals.

Dragosch explained that establishing a federal $BTC reserve would require Congressional approval, but smaller-scale purchases could proceed through an executive order by the President.

Governments Globally Consider $BTC Reserves

Dragosch noted that several countries apart from the US appear to be quietly purchasing $BTC, and over five nations plan to introduce laws related to $BTC reserves.

Namely, Polish presidential candidate Sawomir Mentzen promised to adopt a strategic $BTC reserve if elected.

Dragosch highlighted increased retail interest, evidenced by record-breaking Google searches for terms like Bitcoin' and meme coin.' He also pointed out that transaction volumes below $100K hit a three-year high, indicating growing retail investor participation.

Despite this optimism, Dragosch predicted a possible temporary correction in $BTC's price.

However, he believes $BTC could reach $100K in 2024 and $200K in 2025, framing any short-term price drop as an opportunity to increase exposure ahead of a major bull market phase.

Will $BTC Hit $100K?

Dragosch identified several factors that could potentially push $BTC toward $100K by the end of the year.

He highlighted that the supply deficit caused by the halving has intensified due to high net inflows into US spot $BTC ETFs.

Over the past five trading days, US $BTC ETFs acquired nearly 19K $BTC, while the total $BTC supply grew by only 2.2K during the same period. Weekly ETF purchases now exceed mining by 8.4 times.

Corporate adoption of $BTC as a treasury asset also exacerbated the supply shock. Three new companies announced $BTC treasury adoption last week, contributing to a 40% growth in global corporate $BTC reserves in 2024, compared to a mere 0.8% increase in total token supply.

Dragosch noted that MicroStrategy, led by Michael Saylor, likely made additional purchases recently.

Short-Term Outlook: An Altcoin Bull Run?

In the short term, Dragosch predicted a potential altcoin bull run during $BTC's price correction.

Over the past week, 60% of altcoins tracked by Bitwise outperformed $BTC. Short-term holders took profits as $BTC reached a new all-time high (ATH), marking their highest gains since March 2024.

Dragosch linked altcoin performance to market risk appetite, explaining that increased altcoin purchases typicallysignal greater risk tolerance.

Dragosch observed negative sentiment in traditional financial markets, as measured by the Cross Asset Risk Appetite (CARA) index.

Trump's presidency pressured stocks, bonds, and commodities, leaving the index at a neutral level for cross-asset risk appetite.

ETP Inflows Signal Strong Interest

Investment in crypto exchange-traded products (ETPs) continued to surge last week, with global net inflows reaching $2.1B, surpassing the previous week's $1.96B.

$BTC ETPs led the way, accounting for $1.67B in inflows from US spot $BTC ETFs alone.

However, some products, such as the Grayscale Bitcoin Trust ($85.7M) and European offerings like the ETC Group Physical $BTC ETP (-$35M), experienced significant outflows.

Ethereum ($ETH) ETPs are gaining momentum, with $632.3M in net inflows - almost five times the $131.4M recorded the week before.

US $ETH spot ETFs contributed $515.2M, while European products, such as the ETC Group Physical Ethereum ETP and Ethereum Staking ETP, saw modest gains.

Altcoin-focused ETPs (excluding $ETH) also saw inflows totaling $47.8M last week. Solana ($SOL) products stood out, securing $1.4M in new investments.

On the other hand, thematic and basket crypto ETPs faced $103.7M in outflows, signaling reduced investor interest in diversified crypto products.

Meanwhile, global crypto hedge funds significantly increased their market exposure to $BTC. The rolling 20-day beta of hedge fund performance relative to $BTC rose to 0.88, reflecting heightened confidence in $BTC's potential upside.

Closing Remarks

Given the substantial inflows into crypto ETPs and increased interest of governments worldwide in $BTC strategic reserves, Dragosch's prediction doesn't seem all that unrealistic.

However, the crypto market is notoriously volatile, so only time will tell whether $BTC can reach $200K.

References

• Andre Dragosch (X)
• David F. Baley (X)
• Ki Young Ju (X)
• Bitwise Bitcoin ETF (Bitwise)

The post Bitwise Analyst: $BTC to Hit $100K by Year-End and $200K by 2025 appeared first on Techreport.