Bitcoin Price Prediction
The recent correction in the crypto market is seen as an opportunity for long-term investors. According to Matt Hougan, chief investment officer at Bitwise, there are key factors that could push Bitcoin to $100,000 by the end of the year. Here are the reasons behind the optimistic price prediction:
- Inflows to U.S. spot Bitcoin exchange-traded funds
- Post-halving supply shortages
- Eventual launch of Ethereum spot ETFs
- U.S. Federal Reserve rate cuts
- Shifting political landscape in Washington
Market Dynamic
Despite short-term negative news, there are positive long-term trends that present a significant opportunity for investors. The dichotomy between short-term and long-term news creates favorable conditions for long-term holders.
Impact of Inflation Data
The recent U.S. inflation data showed a dip in June, which led to optimism in equities markets. However, this positive sentiment has yet to be reflected in the crypto market.
Federal Reserve Rate Cut
Cooling inflation could prompt the Federal Reserve to cut rates, which would benefit risk assets like Bitcoin. Traders are expecting a rate cut to happen as early as September.
Bitcoin Supply
Bitcoin’s supply continues to shrink post-halving, forcing miners to face mounting difficulties. This tightening of supply could push the price higher in the long run.
ETF Demand
Despite concerns about Mt. Gox creditors and Germany’s Bitcoin sales, the demand for Bitcoin ETFs remains strong. Spot Bitcoin ETFs have attracted billions of dollars in new assets since their launch in January.
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