Apollo Crypto Predicts Bitcoin Price Of $200,000 This Cycle, Here’s Why
07 Diciembre 2023 - 6:30AM
NEWSBTC
Apollo Crypto, a renowned name in the field of cryptocurrency
analysis, has recently released a comprehensive report predicting a
significant surge in the Bitcoin price, potentially reaching as
high as $200,000 in the current cycle. Authored by Henrik
Andersson, the report delves into various factors that could
contribute to this remarkable growth. A pivotal aspect of the
report is the anticipated approval of the first spot Bitcoin
Exchange-Traded Fund (ETF) in the United States. Eric Balchunas,
the senior Bloomberg ETF analyst, is quoted saying, “There is a 90%
chance of an approval by January 10, 2024.” This development is
seen as a significant driver for Bitcoin’s price increase. The
report elaborates on the interest from prominent asset managers in
Bitcoin spot ETFs, asserting, “In our view, it is likely that the
SEC won’t give preferential treatment to a single ETF issuer;
therefore several of them are likely to get approval at the same
time.” Bitcoin ETF Inflow Estimate And Multiplier Effect A key
element in Apollo Crypto’s analysis is the potential new money
inflow into Bitcoin ETFs. The report estimates this by considering
the total size of US holdings of equities at $64.7 trillion.
Related Reading: Bitcoin Poised For December Surge As Historical
Patterns Suggest Strong Upside Ahead It assumes that 10% of these
investors would allocate 1% to Bitcoin ETFs, leading to an
estimated inflow of $65 billion. This number is cross-referenced
with the total US ETF market size of $6.5 trillion, where Bitcoin
ETFs are expected to capture 1%, aligning with the $65 billion
inflow estimate. The concept of the ‘Bitcoin multiplier’ is also
central to the report’s analysis. This refers to the effect of each
dollar inflow on Bitcoin’s market cap. The report cites the next
BTC halving in April 2024, which will reduce the new supply of BTC,
as a factor that could increase the multiplier effect. Referring to
a Bank of America report titled “Bitcoin’s dirty little secrets,”
Apollo Crypto notes, “For example, we estimate that a net inflow of
just $93 million would result in price appreciation of 1%.” From
this, they deduce a 114x multiplier effect as an upper bound but
apply a more conservative estimate of 50x for their scenario.
Related Reading: Bitcoin Bullish Fractal Returns: Analyst Predicts
Another Leg-Up With Price Target Combining the inflow estimate and
the multiplier effect, the report concludes that Bitcoin could
reach $200,000 per coin in this cycle: Putting it all together
leads us to believe that we could see $65 billion in inflow to
Bitcoin ETFs in the coming cycle. Applying a 50x multiplier effect
leads to an increased market cap of $3.25 trillion in which case we
would see Bitcoin trading at $200,000 per coin. We realize this is
a bold estimate with a lot of uncertainty. Flow-On Effect On
Ethereum The report doesn’t stop at Bitcoin. It also analyzes the
performance relationship between Bitcoin and Ethereum during the
last bull market, using a specified period from September 2020 to
November 2021. During this phase, the report notes, “Bitcoin
increased 4.8x while Ethereum increased 9.8x; Ethereum increased
twice as much as Bitcoin during this time.” This historical data is
crucial as it indicates that Ethereum tends to have a higher beta,
or sensitivity, to Bitcoin’s market movements. Building on this
relationship, the report projects that if Bitcoin’s price were to
quintuple – as suggested in their forecast from $40,000 to $200,000
– then based on the past market behavior, Ethereum could
potentially experience a parallel and more pronounced surge. The
report estimates, “If the relationship holds for the coming cycle
and Bitcoin increases 5x, then Ethereum would reach $22,000.” At
press time, BTC traded at $43,371. Featured image from
Shutterstock, chart from TradingView.com
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