Despite recent setbacks and a significant selloff that brought Bitcoin to a three-month low, Standard Chartered maintains a strong bullish position on BTC market predictions. Geoffrey Kendrick, the head of digital assets research at the bank, forecasts that Bitcoin will climb to $500,000 before the conclusion of Donald Trump’s presidency. Additionally, BTC price might reach $200,000 by the end of 2025.
Bitcoin Remains Bullish Despite New Low
Standard Chartered predicts that although US President Donald Trump’s first month in office has introduced high volatility for risk assets, his administration could ultimately benefit Bitcoin. In a CNBC interview, Geoffrey Kendrick, the head of digital assets research at Standard Chartered, projected that Bitcoin’s price would hit $200,000 this year. He anticipates it will surge to $500,000 by the end of President Trump’s second term, influenced by increased institutional adoption and the possibilities of clearer regulations.
Kendrick stated that the crypto ecosystem would benefit from the involvement of traditional financial institutions like Standard Chartered, BlackRock, and others who manage ETFs. He highlighted that their participation is crucial for legitimizing and stabilizing the market. The infusion of established players into the space is expected to foster more trust among investors, paving the way for broader acceptance of cryptocurrencies.
Kendrick also mentioned that as the industry grows more institutionalized, it should become safer and likely attract fewer negative headlines, such as the recent $1.5 billion hack at the cryptocurrency exchange Bybit last week. Institutional involvement is crucial for not only providing capital but also for creating robust infrastructures that can withstand the shocks and stresses of traditional financial markets.
Additionally, the rising adoption of cryptocurrencies by institutions, along with some regulatory clarity in the U.S., is expected to gradually reduce market volatility over time. This evolving landscape may contribute to a more mature market, where price fluctuations become less erratic and more predictable.
Earlier this week, Bitcoin dropped to a three-month low, falling below $90,000 amidst declines in global equity markets, as per CoinGecko data. On Thursday, the Bitcoin price made it to a trading value of $82,256, marking a roughly 20% decrease from its January peak. Such abrupt changes can unsettle investors, but seasoned analysts like Kendrick maintain that the long-term outlook remains strong.
Geoffrey Kendrick noted that the crypto market has broadly declined due to uncertainties surrounding tariffs and the resolution of significant conflicts like those in Russia-Ukraine and Israel-Gaza. These geopolitical factors often lead to increased volatility in global markets, and cryptocurrencies are not immune to such pressures. As traditional markets react to news and events, cryptocurrencies tend to experience similar oscillations.
Bitcoin’s Outlook is Strong Despite Correction
Bitcoin recently dropped below $82,000, hitting a three-month low in response to broader market declines. This market uncertainty is reflected in Bitcoin’s Short-Term Holder Spent Output Profit Ratio (STH-SOPR), which is hovering near the critical 1.0 breakeven level. A report from Glassnode suggests that breaking above this threshold historically signals bullish momentum, while failure could trigger another wave of selling. The behavior of short-term holders is a significant indicator of market sentiment, which remains pivotal during periods of decline.
The STH-SOPR ratio, ranging from 0.98 to 1.04, has closely followed Bitcoin’s price movements. Recently, it indicated that short-term holders are uncertain, affecting Bitcoin’s potential to reach new highs or face further declines. This lack of confidence among newer investors often leads to an exacerbation of market downturns as panic selling can amplify existing declines.
However, Julien Bittel, a Global Macro Investor, described Bitcoin’s recent price drop as a “normal occurrence in bull markets,” particularly after the substantial price surge that followed the US presidential election. History has shown that such pullbacks can be part of the natural cycle of growth, serving as a healthy correction rather than a sign of impending doom.
With Bitcoin trading at a significantly lower price, it presents an attractive opportunity for whales and institutions to buy more during this dip. As buying interest increases, the price of BTC could experience a robust recovery, potentially initiating another bull run in the upcoming weeks. The likelihood of institutional buy-ins during price dips often serves as a stabilizing force in the market, giving confidence to smaller investors.
