The Surge of Bitcoin Post-U.S. Elections
Bitcoin has experienced an impressive rise following the recent U.S. elections, capturing the interest of investors and analysts alike. Investment management firm VanEck has projected that this leading cryptocurrency could reach a staggering $180,000 by the year 2025. Matthew Sigel, the head of digital assets research at VanEck, recently shared his optimistic outlook on CNBC’s “Squawk Box” on November 14. He asserted that “it is just getting started,” indicating a belief in the longevity of Bitcoin’s upward trajectory.
Entering ‘Blue Sky Territory’
Sigel described the current market conditions as “blue sky territory,” suggesting that Bitcoin faces no significant technical resistance preventing its ascent. He expects that over the coming two quarters, the cryptocurrency will see repeated all-time highs (ATHs), fueled by a notable price increase of nearly 30% since November 5. On November 13, Bitcoin peaked at just under $93,490.
Market Resilience and Future Projections
Despite a brief reduction in momentum, Bitcoin remains robust, trading around $88,100 as of November 15. VanEck’s target of $180,000 would represent a tenfold increase from the cycle’s lowest point, and interestingly, it marks the smallest Bitcoin rally relative to previous cycles. However, Sigel highlighted positive indicators that suggest this momentum is far from waning. As he put it, “Our target is $180,000. We think we could reach that next year,” especially given that metrics tracked by VanEck are still “flashing green.”
Growing Public Interest
The public’s enthusiasm for Bitcoin is substantiated by rising search interest and app downloads. While Google search volumes for “Bitcoin” are still below the 2021 peak, they have surged nearly threefold since early November. Furthermore, Coinbase has ascended to the top of the finance app rankings in both Apple and Google Play stores, reflecting a growing user base interested in cryptocurrency. Sigel noted an uptick in inquiries from investment advisers seeking exposure to Bitcoin, signaling potential future inflows into the market.
Comparison to Previous Cycles
VanEck’s optimistic outlook draws parallels to Bitcoin’s performance following the 2020 elections when the asset doubled in value between Election Day and the end of the year. With growing institutional interest and technical barriers seemingly absent, observers believe the stage is set for another remarkable Bitcoin cycle ahead.
Inflows from Traditional Funds Boosting Bitcoin
Bitcoin’s recent surge past the $93,000 mark can also be attributed to significant inflows from traditional funds via Bitcoin ETFs. Ryan Lee, Chief Analyst at Bitget Research, indicated that a compelling narrative surrounds Bitcoin, suggesting it could be adopted as a U.S. reserve asset, a possibility hinted at by President-elect Trump at the Nashville Bitcoin Conference.
Projected Price Ranges for Bitcoin
Lee elaborated on his projections, stating a price range of $82,000 to $110,000 in the short term, while suggesting a broader range of $73,000 to $150,000 over the next six months. Additionally, upcoming regulatory policies concerning cryptocurrency could provide extra market support, fueling further investment.
Key Indicators to Watch
Lee emphasized the importance of monitoring key market indicators, particularly the funding rate. If the funding rate for long positions in contracts exceeds an annualized 50% or 0.05% every eight hours, it could indicate potential adjustments. He also warned that should Bitcoin breach the $94,000 mark, it might trigger a wave of short liquidations amounting to approximately $1 billion, further accelerating the price momentum.