Bitcoin
Is $200,000 a Realistic Bitcoin Price Target for This Cycle?
Published
6 days agoon
By
adminBitcoin has been making waves in the financial world, with many speculating about its potential to reach new heights. As we explore whether the Bitcoin price can realistically hit $200,000 this cycle, we’ll dive into the market dynamics and what drives prices higher.
For an in-depth complete analysis, refer to the original Can Bitcoin Realistically Reach $200,000? full video presentation available on Bitcoin Magazine Pro’s YouTube channel.
Key Takeaways
- Bitcoin’s price is influenced by supply and demand dynamics.
- Long-term holders play a significant role in market stability.
- The money multiplier effect shows how market cap can increase with new investments.
- Current trends suggest a cautious outlook for reaching $200,000.
Understanding Supply And Demand
At its core, Bitcoin’s price is driven by supply and demand. If the supply decreases or remains stable while demand increases, we can expect the price to rise. To gauge this, we look at how much new Bitcoin is being accumulated by new market participants and how much is being distributed by long-term holders.
Related: We’re Repeating The 2017 Bitcoin Bull Cycle
The Role Of Long-Term Holders
Long-term holders are defined as those who have held Bitcoin for 155 days or more. This group tends to influence the market significantly. Recently, the long-term holder supply peaked at around 16.14 million BTC. However, as of now, that number has dropped to about 14.5 million BTC. This shift indicates that a substantial amount of Bitcoin has been moved, which can impact market dynamics.
Short-Term Holders And Market Influence
Short-term holders, including institutional buyers and corporations, are actively accumulating Bitcoin. Their actions can influence the market cap and price of Bitcoin. The money multiplier effect is a concept that helps us understand how much impact a dollar inflow can have on Bitcoin’s market cap. For instance, if we consider that $1 invested in Bitcoin can increase the market cap by about $2.5 to $6.73, it shows the potential for significant price movements based on new investments.
Calculating The Money Multiplier Effect
To get a clearer picture, we can analyze the relationship between the long-term and short-term holder supplies and the market cap. By averaging data over a 90-day period, we can see that the current money multiplier effect is around 6.73. This means that for every $1 invested, the market cap increases by about $6.73.
What Would It Take To Reach $200,000?
To explore the possibility of Bitcoin reaching $200,000, we need to consider the market cap. Currently, Bitcoin’s market cap is above $2 trillion. To hit $200,000, it would need to reach about $4 trillion. The difference of $2 trillion would require a significant amount of Bitcoin to change hands.
If we assume an average accumulation price of $150,000, we would need about 1.9 million BTC to be transferred from long-term to short-term holders. This would reduce the long-term holder supply to about 12.6 million BTC. Given the current trends, this scenario seems a bit of a stretch, as we’ve seen a decline in the amount of Bitcoin being transferred in recent cycles.
Historical Trends And Future Predictions
Historically, we’ve seen a diminishing trend in the amount of Bitcoin transferred from long-term to short-term holders. If we look at previous cycles, the maximum amount transferred has decreased over time. This suggests that reaching 12.6 million BTC in long-term holder supply may not be realistic for this cycle.
However, if we adjust our expectations to around $150,000, it appears more attainable, requiring a long-term holder supply of about 13.3 million BTC. This aligns better with historical trends.
Related: What Bitcoin Price History Predicts for February 2025
Conclusion: Is $200,000 Possible?
In summary, while reaching $200,000 for Bitcoin is not out of the question, it requires a significant shift in the market dynamics. The current money multiplier effect and the trends in long-term holder supply suggest that while it’s possible, it may be more realistic to focus on the $150,000 to $250,000 range. The market is constantly evolving, and with institutional interest growing, we might see unexpected movements in the future.
As always, it’s essential to stay informed and consider all factors when making investment decisions.
If you’re interested in more in-depth analysis and real-time data, consider checking out Bitcoin Magazine Pro for valuable insights into the Bitcoin market.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. Always do your own research before making any investment decisions.
Source link
You may like
Top Expert Predicts XRP Price Crash To $2, What’s Next?
Bitwise Predicts ‘Violent’ Surge Amid Trump’s Tariffs
‘It’s Over’ – Trader Issues Dire Solana Warning, Says SOL Flashing Same Bearish Signal As 2021 Meltdown
CME Group to Launch Options on Its Bitcoin Friday Futures in February
Monochrome Brings First Aussie Bitcoin, Ethereum ETFs to Singapore Market
Trump’s tariffs send Bitcoin and crypto market tumbling
Bitcoin
Bitwise Predicts ‘Violent’ Surge Amid Trump’s Tariffs
Published
3 hours agoon
February 3, 2025By
adminThe Bitcoin price sank by more than 13.5% over the weekend, dropping as low as $91,201 on Binance. The sell-off followed US President Donald Trump’s announcement of new trade tariffs. The administration levied a 25% tariff on most imports from Canada and Mexico, added a 10% tax on Chinese goods, and imposed a 10% tariff on Canadian energy resources.
While market observers typically view such aggressive moves as a negative for risk assets, one prominent voice at Bitwise Invest sees a wildly different scenario, predicting that these tariffs could fuel a “violent” long-term rally in Bitcoin.
Why Tariffs May Supercharge Bitcoin
Jeff Park, Head of Alpha Strategies at Bitwise Invest, argues that these tariffs cannot be understood simply as a response to trade imbalances but should be viewed against the broader backdrop of the so-called Triffin dilemma. In Park’s words, “The US wants to keep its ability to borrow cheaply, but rid its structural overvaluation and constant trade deficits—enter tariffs.”
Related Reading
He suggests that, by using tariffs as a bargaining chip, the White House is looking to create a new multi-lateral agreement—akin to a “Plaza Accord 2.0”—aimed at weakening the US dollar. This would potentially oblige foreign governments to reduce their US dollar reserves or to hold longer-duration Treasuries, thereby keeping yields low without officially enacting yield curve control.
Park also ties this strategy to the president’s personal incentives. He believes Trump’s “#1 goal” is to drive down the 10-year Treasury yield, in part because cheaper long-term financing would benefit real estate markets. According to Park, such a push for lower yields dovetails with a deliberate move to weaken the dollar—two conditions that, in his view, create a perfect environment for Bitcoin to flourish.
“The asset to own therefore is Bitcoin. In a world of weaker dollar and weaker US rates, something broken pundits will tell you is impossible (because they can’t model statecraft), risk assets in the US will fly through the roof beyond your wildest imagination, for it is likely a giant tax cut will have to accompany the higher costs borne by the loss of comparative advantage,” Park writes.
His thesis is that the “online and onchain” nature of today’s economy will funnel frustrated citizens across the globe toward alternative stores of value—namely Bitcoin. He believes both sides of any prolonged tariff war will discover that BTC offers a refuge from the fallout, leading to what he describes as a much higher price trajectory.
Related Reading
“So while both sides of the trade imbalance equation will want Bitcoin for two different reasons, the end result is the same: higher, violently faster—for we are at war. TLDR: You simply have not yet grasped how amazing a sustained tariff war is going to be for Bitcoin in the long run,” Park claims.
Tariffs As A Risk Asset Drag
Not all analysts share Park’s optimism. Alex Krüger, an economist and trader from Argentina, disagrees with the notion that tariffs of this magnitude inherently favor Bitcoin. He warned that “Bitcoin is mainly a risk asset.”
He added: Tariffs this aggressive are very negative for risk assets. And the economy will take a hit. The tariffs announced are considerably worse than what was expected by the market, as gradual tariffs or delayed implementation were seen as alternatives. So the S&P futures will open deeply in the red tonight and flush.”
In Krüger’s view, Bitcoin remains a high-beta asset often correlated with equity markets. When a major macro shock—like a sudden hike in tariffs—hits, investors typically rotate into safe havens rather than riskier holdings such as stocks or cryptocurrencies. He pointed out that the sell-off in crypto over the weekend might be explained by the market reacting to an “unexpectedly harsh” tariff announcement.
“The hope for crypto is that it has already dropped a lot in anticipation,” Krüger observed, hinting that digital assets may find a local bottom if the initial shock has been fully absorbed. However, he emphasized the persistent uncertainty ahead, including the possibility of retaliation by targeted nations. A swift resolution to the trade dispute could trigger a bounce, whereas an escalation could deepen market jitters.
Krüger also cautioned that the Federal Reserve might turn hawkish if tariffs stoke inflation—an outcome that rarely bodes well for high-growth or risk-prone assets. Still, he hasn’t ruled out fresh all-time highs in equities later this year:
“I still don’t think the cycle top is in, and expect equity indices to print ATHs later in the year. But the probability of being wrong has increased. Particularly on the latter. As I said a week ago, I’ve taken my long-term hat off. This is a traders’ market.”
At press time, BTC traded at $94,000.
Featured image created with DALL.E, chart from TradingView.com
Source link
Bitcoin
CME Group to Launch Options on Its Bitcoin Friday Futures in February
Published
6 hours agoon
February 3, 2025By
adminCME Group, the world’s leading derivatives marketplace, has announced plans to introduce options on its Bitcoin Friday futures starting February 24, pending regulatory approval. These new contracts will be the first cryptocurrency options from CME Group to be financially settled, with expirations available each business day, Monday through Friday.
Financially-settled options, also known as cash-settled options, are derivatives contracts where the settlement at expiration does not involve the physical delivery of the underlying asset. Instead, the profit or loss from the option is calculated based on the difference between the option’s strike price and the market price of the underlying asset at the time of expiration, and this amount is then paid in cash.
“We are pleased to offer these new options that provide traders with even greater precision to manage short-term bitcoin price risk,” said Giovanni Vicioso, CME Group’s Global Head of Cryptocurrency Products. “Building on the success of our Bitcoin Friday futures, the smaller size of these contracts, along with daily expiries, offer market participants a capital-efficient toolset to effectively adjust their bitcoin exposure.”
CME Group said these financially-settled options will enhance its lineup of other cryptocurrency derivatives, which already includes physically-settled options on Bitcoin and Micro Bitcoin futures.
“Given the increasing density of tradable catalysts in crypto, CME Group’s new option suite on Bitcoin Friday futures provides the granularity that market participants need for hedging and expressing nuanced views on Bitcoin,” said Joshua Lim, Global Co-head of Markets at FalconX.
Since their launch on September 29, Bitcoin Friday futures have become CME Group’s most successful cryptocurrency product, with over 775,000 contracts traded and an average daily volume of 9,700 contracts. Notably, 44% of trades occurred during non-U.S. hours, highlighting global demand.
Source link
bear market
Trump’s tariffs send Bitcoin and crypto market tumbling
Published
8 hours agoon
February 3, 2025By
adminAfter President Donald Trump targeted China, Mexico, and Canada with long-threatened import taxes, the crypto market fell on Feb. 1 in a risk-off action. Bitcoin’s price fell by 5%, which has rippled its way into altcoins.
Effective Feb. 1, the U.S. will impose tariffs of 25% on imports from Canada and Mexico and 10% on Chinese goods, adding further complexity to the current trade wars.
As a result, over the past 24 hours ending on Feb. 3, Bitcoin (BTC) has experienced a notable decline amid a market-wide sell-off. The cryptocurrency fell by over 5%, reaching a low of approximately $91,200 before rebounding to around $94,000 as of this writing.
Despite this recovery, BTC remains roughly 13% below its all-time high of $109,000, and trading volume has surged by more than 200%, suggesting considerable selling pressure or market panic.
Additionally, the overall global crypto market cap has dropped nearly 12% during the same period, settling at about $3.15 trillion.
It’s worth noting that following President Donald Trump’s inauguration on Jan. 20, Bitcoin and other altcoins saw a significant price increase. However, since that peak, recent developments—including new tariff policies—have contributed to a drastic decline in market sentiment and asset values.
Given Bitcoin’s recent price crash, it has had a cascading effect on altcoins. In the last 24 hours, Ethereum (ETH) has fallen by nearly 20%, Ripple (XRP) by 22%, Solana (SOL) by 8%, and Binance Coin (BNB) by over 15%.
Rising trading volume alongside price dips often signals strong selling pressure or market panic, as more traders offload their assets. This pattern suggests that long-term investors are now selling their coins at lower profits than their purchase price—or even at a loss year-to-date—as illustrated by the Bitcoin: Long Term Holder SOPR chart.
Such behavior often indicates capitulation among long-term holders, a phenomenon common during bearish market trends and corrections. Experts, including BitMEX CEO Arthur Hayes, have even warned that a “financial crisis” may be on the horizon.
Source link
Crypto Stocks Fall 5% as U.S. Futures Point to More Bitcoin Losses
Top Expert Predicts XRP Price Crash To $2, What’s Next?
Bitwise Predicts ‘Violent’ Surge Amid Trump’s Tariffs
‘It’s Over’ – Trader Issues Dire Solana Warning, Says SOL Flashing Same Bearish Signal As 2021 Meltdown
CME Group to Launch Options on Its Bitcoin Friday Futures in February
Monochrome Brings First Aussie Bitcoin, Ethereum ETFs to Singapore Market
Trump’s tariffs send Bitcoin and crypto market tumbling
Bitcoin Trades Above $93.5K as Traders in Asia Consider Trump’s Trade War
Key Levels to Watch as BTC Crashes Below $100K Today
Chainlink Set for $36? Whale Moves Suggest a Big Rally—Analyst
Analyst Warns XRP Holders Might Witness Short-Term Pain, Updates Outlook for Bitcoin and Solana
Forget About The Strategic Bitcoin Reserve For A Moment — Mining Censorship Is Back
XRP, Solana and Dogecoin Crash as Trump’s Trade War Knocks Bitcoin Under $97K
This new coin has the same potential as Dogecoin 5 years ago
Wintermute CEO Evgeny Gaevoy Discusses the Future of Crypto Trading
Arthur Hayes, Murad’s Prediction For Meme Coins, AI & DeFi Coins For 2025
Aptos Leverages Chainlink To Enhance Scalability and Data Access
Bitcoin Could Rally to $80,000 on the Eve of US Elections
Institutional Investors Go All In on Crypto as 57% Plan to Boost Allocations as Bull Run Heats Up, Sygnum Survey Reveals
Crypto’s Big Trump Gamble Is Risky
Ripple-SEC Case Ends, But These 3 Rivals Could Jump 500x
A16z-backed Espresso announces mainnet launch of core product
Xmas Altcoin Rally Insights by BNM Agent I
Expert Sees Bitcoin Dipping To $50K While Bullish Signs Persist
Blockchain groups challenge new broker reporting rule
Trump’s Coin Is About As Revolutionary As OneCoin
Ripple Vs. SEC, Shiba Inu, US Elections Steal Spotlight
Will Ethereum Price Fail $3,000 Breakout as Whale Selling Prolongs?
SAFE rallies 20% on Bithumb listing
Spot ETFs Fail To Ignite Bitcoin Growth – Analyst
Trending
- 24/7 Cryptocurrency News3 months ago
Arthur Hayes, Murad’s Prediction For Meme Coins, AI & DeFi Coins For 2025
- 24/7 Cryptocurrency News4 weeks ago
Aptos Leverages Chainlink To Enhance Scalability and Data Access
- Bitcoin3 months ago
Bitcoin Could Rally to $80,000 on the Eve of US Elections
- Bitcoin3 months ago
Institutional Investors Go All In on Crypto as 57% Plan to Boost Allocations as Bull Run Heats Up, Sygnum Survey Reveals
- Opinion3 months ago
Crypto’s Big Trump Gamble Is Risky
- Price analysis3 months ago
Ripple-SEC Case Ends, But These 3 Rivals Could Jump 500x
- Blockchain3 months ago
A16z-backed Espresso announces mainnet launch of core product
- Video2 months ago
Xmas Altcoin Rally Insights by BNM Agent I