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The latest memo shared with clients, Bitwise CIO Matt Hougan highlighted several factors that could cause Bitcoin (BTC) to “melt” to $80,000 in the last quarter of 2024.
Factors Driving Bitcoin To $80,000
Hougan highlighted three key scenarios that could push BTC to new all-time highs (ATH) in 2024. First, he referred to the upcoming US presidential election in November, which may have an impact on the future BTC price path.
According to Hougan, anything other than a Democratic sweep would benefit the top cryptocurrency by market cap.
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In the memo, Hougan explained that while many view the election as a binary election — with Republican candidate Donald Trump in favor of the crypto industry and Democratic candidate Kamala Harris seen as dangerous — the reality on the Democratic side is very different. He said:
The Democratic Party has different views on crypto, from Senator Elizabeth Warren’s (D-Mass.) “Anti-Crypto Army” to Representative Ritchie Torres’ (DN.Y.) deep support. The problem of the last four years is that the Warren Division has controlled policy and agency recruitment, and that is creating a hostile environment in the field.
Hougan expressed confidence in Republicans, saying that their victory would “undoubtedly” be good for crypto. However, he also pointed to recent comments by Democrat Maxine Waters, who said that “crypto is inevitable,” suggesting that Democrats may be more open to digital assets.
Second, Hougan brought attention to the US Federal Reserve’s (Fed) interest rate cuts. On September 18, the Fed lowered key interest rates by 50 basis points (bps), sparking a crypto rally. In addition, the decision of the People’s Bank of China (PBoC) to inject economic stimulus into the Chinese economy has given more fuel to digital assets to push forward.
Hougan noted that the market expects another 50 bps rate cut from the Fed before the end of the year, as well as more fiscal stimulus from China. The crypto market could see a strong rally in Q4 2024 if both happen.
Finally, Hougan said that a period without major surprises will support a potential rally of BTC to $80,000. He concluded that negative surprises, such as major crypto exchange hacks, new lawsuits, or the release of previously locked coins could derail this momentum.
Main Ingredient To Rip To $100,000 BTC
Hougan also said that the growth of pro-crypto sentiment will be necessary for BTC to reach the ambitious goal of $100,000 in the coming months.
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He recalled the famous “DeFi summer” of 2020 as an example and sees a similar market shift towards crypto, driven by the growing use of stablecoins, high-yield blockchains, and the innovation of passive yield solutions.
In related news, the CEO of crypto mining firm CleanSpark, Zach Bradford, recently is open that Bitcoin could reach as high as $200,000 in the next 18 months given the right conditions.
That said, geopolitical is the latest to climb in the Middle East could have a negative impact on risk assets such as stocks and crypto in the short term. BTC is trading at $61,999 at press time, down 1.4% in the last 24 hours.
Featured image from Unsplash, chart from Tradingview.com