With just weeks left until the highly anticipated bitcoin halving, industry expert Mark Yusko, CEO of Morgan Creek Capital Management, is fueling the fire of investor enthusiasm with a bold price prediction: bitcoin will reach staggering $150,000 by 2025.
Will bitcoin record a new ATH?
Yusko's bullish outlook depends on a combination of factors. He cites Metcalfe's law, a network effect model, to estimate the current “fair value” of the leading crypto at $50,000.
The upcoming halving, which halves miner rewards, is expected to alter supply dynamics and has historically been followed by price increases. However, Yusko recognizes the emergence of transaction fees as a new feature, which could mitigate the immediate impact of the halving on miners' profitability.
This cycle could be a little different, Yusko says, referring to the transaction fees generated by Ordinals and Inscriptions, a recent development that allows users to insert data into the bitcoin blockchain.
The 'fair value' of bitcoin
Despite this, it anticipates a fair value of $75,000 after the halving due to factors such as increased investor interest and the “fear of missing out” (FOMO) that often accompanies such events.
Yusko is not alone in his optimism. Big names like Robert Kiyosaki and Standard Chartered bank share their belief in a potential price target of $150,000. This sentiment echoes the broader bullish trend in the cryptocurrency market, driven by growing institutional adoption and growing recognition of bitcoin as a potential hedge against inflation.
BTCUSD trading at $70,227 on the weekly chart: TradingView.com
But not everyone is convinced. bitcoin's price history is notoriously volatile, and external factors like regulatory changes or economic crises can quickly derail even the best-reasoned predictions. Critics also point out limitations in applying Metcalfe's law, originally designed for communication networks, to a complex system like bitcoin.
Exact Price Path Unclear
The path to $150,000 is also unclear. While Yusko predicts a significant rise in prices after the halving, with a potential peak around nine months later (late 2024), the exact trajectory depends on a delicate balance between supply and demand.
Increased demand from institutional investors, particularly through vehicles like bitcoin ETFs, could drive the price higher. However, this must be offset by a limited supply due to the halving.
The price has to rise with more demand than supply, the analyst emphasizes, suggesting a potentially parabolic price movement towards the end of the year. Historically, bitcoin price peaks have occurred around nine months after halving events, before a subsequent bear market takes hold.
Featured image from Pexels, chart from TradingView
