1 Super Cryptocurrency Could Soar to $200,000 by 2025

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1 Super Cryptocurrency Could Soar to $200,000 by 2025, According to a Wall Street Analyst
Trevor Jennewine, The Motley Fool
Mon, March 18, 2024 at 10:30 AM GMT+1·6 min read

The price of Bitcoin (CRYPTO: BTC) has rocketed by 65% to about $68,000 since the beginning of 2024. But certain Wall Street analysts still see a substantial upside in the cryptocurrency.

Gautam Chhugani at Bernstein believes Bitcoin will reach $150,000 by mid-2025, implying that its price will soar by 120% (or $82,000) during the next 12 to 18 months. Similarly, Geoff Kendrick at Standard Chartered Bank believes Bitcoin could reach $200,000 by the end of 2025, implying that its price could soar by 194% (or $132,000) during the next 21 months.

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Ultimately, cryptocurrencies are no different than any other asset. Their prices are a product of supply and demand. However, the total possible Bitcoin supply is limited to 21 million coins, and 19.7 million (94%) of them are already in circulation. That means demand is the most consequential variable where Bitcoin is concerned.

With that in mind, Chhugani and Kendrick believe two catalysts will turbocharge Bitcoin demand in the coming months: the recent approval of spot Bitcoin exchange-traded funds (ETFs) and the halving event next month.

Spot Bitcoin ETFs should bring more investors to the market
In January, the Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETFs, which differ from the Bitcoin futures ETFs that started trading in 2021. Specifically, spot Bitcoin ETFs track Bitcoin prices precisely because they invest directly in the cryptocurrency. Bitcoin futures ETFs do not track Bitcoin prices as precisely because they invest in futures contracts -- agreements to buy or sell assets at agreed-upon prices on predetermined dates.

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Investors can see that dynamic in action by observing the performance of the ProShares Bitcoin Strategy ETF, the largest Bitcoin futures ETF. While Bitcoin gained about 200% since the start of 2023, the ProShares Bitcoin Strategy ETF is up only 123% in that period.

In short, spot Bitcoin ETFs reduce friction. They offer direct exposure to Bitcoin without the hassle of cryptocurrency exchanges and blockchain wallets. Instead, investors can effectively purchase Bitcoin through existing brokerage accounts and hold it alongside other assets in their portfolios. That convenience could bring more retail traders and institutional investors into the crypto market.

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