Currently, the blockchain-based store-of-value coin was trading at $7,254 on September 3, 2018. So far, the year has been erratic for the digital currency. After a brilliant start at the beginning of 2018, BTC tanked as low as $6,194 in February. But, so did other cryptocurrencies, owing to varied reasons.
Will Bitcoin cross the $100,000 mark this year? Will it be able to replicate the astounding performance of 2017? Let’s take a look.
Mining Difficulties Could Drive Value
We know there are a total of 21 million Bitcoins created for mining purposes. As of September 1, 2018, approximately 17 million coins have been mined already. This will make the mining of the remaining coins harder, with each passing day. The simple laws of demand and supply come into play here. With the supply of coins limited to 21 million, mining complexities, and the immense network jams and scalability issues in the picture, the demand side will increase. The result – prices will escalate.
Moreover, if mining costs increase, the rate at which new coins are mined would also become slower. This would again put a limit to supply, thereby leading to an increase in value.
Price Driven by a Large Uptake of Institutional Investors
Kay Van-Petersen, an analyst at Saxo Bank, accurately predicted the performance of Bitcoin in 2017. For 2018, Van-Petersen is confident of the coin’s ability to hit the $100,000 mark by the end of the year. Bitcoin futures trading contracts were launched by CBOE and CME last year. Van-Petersen is hopeful of greater adoption of these contracts with time, which could drive Bitcoin’s price up.
In addition to the futures contracts, Bitcoin ETFs are waiting for approval by the US SEC. The good news is that the US SEC’s stance on the regulation of crypto assets has been positive for some time now. The regulatory body has passed a dictum for approval of security-based token offerings; STOs in the US crypto markets.
The regulatory body has delayed its decision on the approval of BTC-based ETF applications. The evolution of the futures market and the pending news of a possible ETF approval are both expected to drive up the coin’s price in the future.
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The Global Financial Condition
Many experts believe that we are just on the brink of a financial meltdown. If that happens, Bitcoin could become a safe-haven asset for many investors. Bobby Lee, CEO of China’s first Bitcoin exchange, reaffirmed the prediction that Bitcoin would reach a value of $100,000 by the end of 2018, at the recent London Blockchain Week.
He maintained that despite fluctuations in the market, more people will buy cryptos this year, in the hope of a price surge.
With the introduction of Bitcoin’s new lightning network, many issues regarding its scalability and transaction times will be addressed. But will it reach the $100,000 mark? The crypto markets are highly volatile, and anything can happen here.
To learn more about cryptos and market conditions, stay tuned to Blackwell Global.
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