The incredible rise in the Bitcoin price and increased interest from financial companies have led to monumental projections for the asset in the coming months.
Bitcoin recently overtook the $50,000 mark again as its upward trajectory has been mostly unharmed by small dips and backslides. BTC was able to reach $52,600 on March 3 before retreating back under $50,000 on March 4.
Bitcoin has been on a successive streak of record shattering prices, setting an all-time high of $58,333 on Feb. 21. In trying to explain the reason for this price push, analysts have pointed to a number of factors, but specifically the last halving.
Bitcoin Bull Calls
William Quigley, managing director of Magnetic, told CNN Business that the past BTC halving has been key in the current bull run.
“What’s happened historically whenever that happens for between the next 12 and 18 month, Bitcoin can go up between 300% and 500%,” said Quigley.
The most recent halving happened in May 2020. There has been some skepticism that it may not have the same effect on the price as the previous halvings did.
This was seen after the second halving of July 2016. On the day of the halving the price was at $660 — 17 months later in December 2017 it hit a new high of $20,000.
If this trend and Quigley’s analysis are correct, hitting $100,000 or even above that is not impossible. We are already seeing this pump in the price and it’s only been less than a year since the halving happened.
Other Impacting Factors
While the halving may be having a strong impact on the price, there are other factors that go into pushing Bitcoin higher.
The interest and monetary investment of corporations into Bitcoin have been a major boost for the cryptocurrency. While actual cash injections like Tesla’s $1.5 billion purchase did help push the price, the media and spectacle around such events also contribute to interest and investment.
Nods towards acceptance and backing by other financial institutions have also helped. Goldman Sachs even recently announced that it will reopen its cryptocurrency trading desk.
Institutional hesitancy towards BTC has been one reason it has not succeeded in achieving mainstream acceptance in years previous. Banks and big financial houses cited its volatile nature when explaining why they did not consider it an asset class or valuable investment for itself or clients.
The recent change in tone by institutions could see a fundamental shift towards the acceptance that has so long been denied, along with an impressive price rise.