According to Standard Chartered analysts, Bitcoin price may rise to $120,000 by 2024. This rise is due to the cash-rich miners reduce their sales of the token.
Bitcoin is the world’s most popular and largest crypto by market value. It was trading at $30,495 on Tuesday. This was 1.18% higher than usual. Despite a remarkable 82% surge in 2023, Bitcoin remains far below its peak of $69,000 in November 2021.
Geoff Kendrick from Standard Chartered made a statement. He said if miners make more money for each Bitcoin they mine, they can sell fewer Bitcoins and still make enough money. This leads to a decrease in the total number of Bitcoins available and causes the price of Bitcoin to go up.
Standard Chartered initially predicted Bitcoin to reach $100,000 by the end of 2024. However, they underestimated the effect of increased miner profitability on reducing Bitcoin supply. As per Bloomberg, they expect the price to reach $50,000 by the end of 2024 and potentially surge to $120,000 in 2024.
According to Kendrick, miners have been selling all of the newly mined Bitcoins at current prices. However, if the price of Bitcoin reaches $50,000, he believes that miners would sell only 20-30% of the new Bitcoins they mine.
In addition, the upcoming “halving” event in 2024 will contribute to supply pressures. Halving, which happens every four years, reduces the number of Bitcoin rewards for miners from around 900 per day to about 450. This measure helps maintain Bitcoin below its maximum limit of 21 million tokens.
Moreover, the surge in Bitcoin prices, along with the crypto market, was fueled due to several filing submissions for Bitcoin ETFs in the US. This includes BlackRock Inc.
Bitcoin mining involves miners using powerful computers to verify transaction data on the Bitcoin blockchain. Thereby ensuring the network’s operation and earning tokens as rewards. Miners make a profit by selling the awarded Bitcoin in the market.
According to Bloomberg, when Bitcoin prices rise, miners can sell fewer Bitcoin to cover costs. Thus, keeping more with the hope of future price increases. This shows how miner strategies impact the price of Bitcoins and its future prospects.