Standard Chartered is ramping up its bullish Bitcoin prediction, targeting as much as $120,000 (R2.24 million) by the end of 2024 — almost quadruple the current price — as increasingly cash-rich miners reduce sales of the token.

“Increased miner profitability per BTC mined means they can sell less while maintaining cash inflows, reducing net BTC supply and pushing BTC prices higher,” Geoff Kendrick at Standard Chartered wrote Monday.

Bitcoin mining is an energy-intensive process in which miners use powerful computers to validate transaction data on the Bitcoin blockchain, keeping the network running and earning the token as a reward.

They profit by selling the awarded Bitcoin into the market.

When Bitcoin prices are higher, miners can cover costs selling fewer Bitcoin, holding on to more in the expectation of higher prices in the future.

Bold Bitcoin price predictions are nothing new.

Among the most bullish is from Ark Investment Management’s Cathie Wood, who doubled down on her prediction that Bitcoin will hit $1 million by 2030 as recently as November.

Standard Chartered forecast in April that Bitcoin could reach $100,000 per coin by the end of next year.

That underestimated the impact higher miner profitability would have on reducing the supply of Bitcoin in the marketplace, they now say, and expect the price to hit $50,000 by the end of this year before jumping to as much as $120,000 in 2024.

“At recent prices, they [miners] have been selling 100% of new BTC; at USD 50,000 we think they would sell 20-30%,” Kendrick wrote.

Adding to supply pressure is an upcoming “halving” in 2024, a preprogrammed event that will reduce the supply of Bitcoin rewards available to miners from about 900 per day to about 450. Occurring every four years, it keeps Bitcoin below its limit of 21 million tokens.

Bitcoin, the crypto sector’s largest asset, is trading at $30,309 as of 1:40 p.m. in New York. Its 83% gain this year still leaves it well below its record high of nearly $69,000 in November 2021.

Its recent jump coincided with a raft of filings for Bitcoin exchange-traded funds in the US, including an application by BlackRock Inc., which has a near-pristine record of filing for and receiving approval for ETFs.

source:Bitcoin price will jump over R2 million by end of 2024 — Banking giant (mybroadband.co.za)