Bitcoin is headed for a six-figure value. What exactly is pushing the cryptocurrency’s price up?
Bitcoin rushed to the level of 200 thousand dollars on the chart – this opinion was shared by analysts of the brokerage firm Bernstein. Experts believe that nothing will stop the cryptocurrency before reaching the cherished mark, which they previously called conservative. In a fresh appeal to clients, the company’s analysts also outlined the key factors that can push the market to a large-scale turn of the bullrun. They were the reshuffle in the political life of the United States, as well as the growing adoption of spot exchange-traded funds based on Bitcoin.
The prospect of Bitcoin’s rate rising to seven digits – that is, above a million dollars – has meanwhile been talked about by one of the early representatives of the crypto community, Adam Back. He believes that such a thing will become a reality if the US government decides to create a strategic reserve for the cryptocurrency, which involves acquiring a million BTC over the course of several years.
Here’s Adam’s quote from Twitter.
If the US bitcoin strategic reserve is indeed created, get ready for Bitcoin with a seven-figure price as early as this cycle. For now, the market is sceptical about real action in this direction, so this is not built into the price at all.
Blockstream CEO Adam Back
That said, Back is confident that the coin acquisition will be quiet.
There’s no good way to buy a million BTC except to do it very, very quietly. But once the information is leaked, the whole world will be hit by the lost profit syndrome, and the price will just skyrocket.
Why is Bitcoin’s rate rising?
In the address, analysts mentioned the following phrase. The replica is cited by The Block.
We are entering a stage where, in accordance with our expectations, the intrigue for the bears will turn to pain. The $100k level for Bitcoin seems just around the corner, and our goal of $200k by the end of 2025 now looks not so illusory.
Following Donald Trump’s victory in the US presidential election in the first half of November, his transition team has already started nominating candidates for key positions. For example, crypto-friendly Robert Kennedy Jr. and Pete Hegseth will tentatively take the posts of Secretary of Health and Secretary of Defence respectively.
However, two of the most significant appointments from the crypto market’s perspective are still to come: the nominations for the new chairman of the Securities and Exchange Commission (SEC) and the Secretary of the Treasury.
Hedge fund manager Scott Bessent and Cantor Fitzgerald CEO Howard Lutnick were considered the top candidates for Treasury Secretary until recently. However, this week it became clear that Trump has new favourites – former US Federal Reserve chief Kevin Warsh and Apollo Global Management CEO Mark Rowan.
As it turned out, the reason for the personnel reshuffle could be personal bickering in Trump’s team, which we discussed in detail in a separate article.
Betting on the next US Treasury Secretary
Users of the decentralised betting platform Polymarket consider Warsh the most likely candidate for the role of Treasury Secretary. However, Trump’s inauguration is still about a month away, so the situation could change by then.
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The second important condition is the formation of a national crypto reserve, which Donald mentioned more than once in his election campaign. According to experts, the political impetus for the creation of the reserve has already been achieved.
However, the legislative process could be delayed if it involves annual bitcoin purchases. Here is a rejoinder from Bernstein’s representatives.
Demand for Bitcoin in this cycle is led by institutional, corporate and individual traders. We believe the next cycle will be heavily influenced by larger political forces.
One of the main political proponents of a reserve is Senator Cynthia Lummis. She has also suggested that the Treasury Department convert some of the gold reserve into crypto.
Lummis said that converting the gold certificates held by the Treasury Department would have a “neutral” impact on the US government’s balance sheet, as opposed to spending an additional $90 billion to buy BTC at the current price, Cointelegraph reported.
Senator Cynthia Lummis
The senator has previously argued that the Treasury Department should convert some of its assets to buy BTC into a strategic reserve. However, she has not previously specified which assets should be sold to purchase more of the digital currency.
Finally, experts mentioned the ever-increasing demand for derivative investment instruments. Total assets under management in cryptocurrency ETFs are reaching the $92 billion mark, with net inflows of around $1.7 billion per week over the past few weeks.
Bitcoin ETF reserve dynamics
Another source of significant demand is the ongoing campaign to acquire BTC by MicroStrategy, the largest corporate owner of bitcoins. MicroStrategy wants to raise $42 billion for further purchases of the crypto over the next three years.
For example, yesterday, the giant announced the purchase of 51,780 bitcoins worth $4.6 billion. This brings Michael Saylor’s total holdings of the cryptocurrency to 331,200 coins, with $16.5 billion invested. It is important to note that the latest purchase was the largest in the history of MicroStrategy.
MicroStrategy’s purchase of bitcoins
For Bitcoin to reach Bernstein’s long-term goal of around $200,000, the price of the cryptocurrency needs to grow a little more than double. Even at the current size of the industry, this is a very realistic target within a notional year. So if optimistic forecasts become a reality, in 2025 for 1 BTC will be ready to give six-figure sums.
Investor positivity about the future of the cryptocurrency market is an important component of the bullrun. Still, even though such predictions do not have to come true, they form certain expectations of investors. And some of them will indeed be ready to wait for Bitcoin at $200,000 after such statements of analysts.
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