Bitcoin’s price is showing signs of recovery, but market watchers say to brace for a bumpy ride.
The top cryptocurrency’s outperformance compared to other assets like gold has emboldened analysts to forecast that the price will more than double to $150,000 by the end of the year.
Yet, that growth will need more than just sentiment, according to Max Kahn, CEO of Digital Wealth Partners.
“For Bitcoin to more than double in value by year’s end, we’ll need to see an acceleration in new capital entering the market,” he told DL News.
That means that Bitcoin’s price will follow a “choppier path higher where price appreciation follows actual capital formation, rather than a straight-line move driven by sentiment alone,” Kahn said.
The hesitant bullishness comes as Bitcoin has spent the past month locked between $66,000 and $76,000, a range that reflects a tug-of-war between capital inflows and macroeconomic crosswinds.
But there are signs of recovery. March is on track to be the strongest month for Bitcoin exchange-traded fund inflows since October. Investors have poured in over $1.5 billion so far, with four trading days still on the calendar, DefiLlama data shows.
In a Tuesday note to investors, analysts at Bernstein argued that Bitcoin will reach $150,000 by the end of the year thanks to strong institutional interest in the asset.
To be sure, Bernstein’s predictions have not always panned out. In 2024, the firm forecasted that Bitcoin would end 2025 trading at $200,000. It ended last year trading around $90,000.
Still, investors remain cautious. EToro analyst Simon Peters told DL News that Bitcoin investors are closely monitoring geopolitical tensions, particularly the conflict in the Middle East and its impact on global oil prices.
The conflict has effectively closed the Strait of Hormuz, the artery for roughly one-fifth of global oil and liquefied natural gas.
The recent rise in crude prices has revived inflation concerns, raising the risk that central banks may tighten financial conditions — a dynamic that could weigh on cryptoasset prices in the near to medium term, he said.
Risky assets like Bitcoin are hurt by higher interest rates because they incentivise investors to hold bonds by paying more risk-free yield.
On Wednesday, the International Energy Agency signalled it will release more strategic reserves as Asian economies, heavily reliant on Gulf crude, scramble to contain fuel shortages.
