Pantera Capital, a crypto hedge fund, has reaffirmed its optimistic outlook on Bitcoin, projecting a potential price surge to $114,000 by August 2025. This forecast comes at a time when the industry is grappling with challenges such as inflation concerns, Federal Reserve interest rate policies, and the escalating Middle East crisis.
In its latest report, Pantera Capital revisited its analysis from November 2022, which examined Bitcoin’s past performance before and after its most recent halving event. Using a stock-to-flow model, Pantera assessed the supply of Bitcoin in relation to the rate of new production, which decreases by 50% every four years during halving events. Historical data has shown significant price increases for Bitcoin, sometimes up to 93-fold, in response to these events. By studying pre-halving and post-halving rallies, Pantera Capital determined that prices tend to reach their peak approximately 2.6 years after halving events. Based on this analysis, the projected timeframe for Bitcoin’s potential surge aligns with August next year.
While the stock-to-flow model is not a precise science, it has gained popularity in the crypto industry as a tool to assess the intrinsic value of Bitcoin. Pantera Capital’s forecast joins other optimistic predictions for Bitcoin. Research firm Bernstein has set a target of $150,000 by mid-2025, while Anthony Scaramucci, founder of Skybridge Capital, envisions a price of $170,000 or higher next year. Fundstrat Global Advisors’ Thomas Lee has also expressed the possibility of Bitcoin reaching $150,000 in 2024 and even $500,000 over the next five years.
Bitcoin experienced heightened volatility throughout the week, closing at approximately $64,000, representing a 1.4% increase from the previous week’s closing value of around $63,100. Prices initially dipped significantly to around $56,500 on Wednesday before rebounding above $60,000 by Friday. Although Bitcoin ETFs saw net outflows for the fourth consecutive week, the period of outflows may have peaked, according to Matteo Greco, a research analyst at digital asset investment firm Fineqia International. He noted that trading volume for Bitcoin ETFs remained relatively steady during the week, with cumulative trading volume since inception reaching $246.6 billion. During the week alone, trading volume amounted to $10.9 billion, a 12.3% increase from the previous week. However, these figures still fall below the average trading volume of $3.1 billion since the inception of Bitcoin ETFs. Greco believes that these figures suggest the period of outflows may have peaked, with trading volumes showing signs of increase and outflows potentially stabilizing.
Additionally, after a four-month period of consistent outflows, Grayscale’s spot Bitcoin ETF finally experienced a positive shift. On Friday, May 3, the downward trajectory was reversed when GBTC saw its first inflow of $63 million. As a result, the overall spot Bitcoin ETF market saw net positive inflows of $378.3 million after seven days of continuous outflows. This trend continued on Monday, May 6, as GBTC recorded its second inflow of $3.9 million, bringing the total inflows to $66.9 million.
