Analysts observe that Bitcoin‘s (BTC) velocity indicator has retreated to historically low levels, suggesting a tendency for long-term holding of the largest cryptocurrency. Analysts at Standard Chartered, a major investment bank in the U.S., continue to adhere to their prediction that Bitcoin will reach $100,000 by the end of 2024.
Bitcoin’s Velocity Indicator at Historic Lows
According to analysts, the velocity indicator, which signifies how frequently BTCs are bought and sold or used for transactions, has plunged to historic lows. Bitfinex analysts noted a contrast between the current Bitcoin velocity and the average recorded during the last crypto bear market in 2018-2019. In their investor note, analysts stated, “Historically low Bitcoin velocity indicates a significant change in sentiment compared to the last bear market cycle.”
Analysts at the cryptocurrency exchange Bitfinex believe that the low Bitcoin velocity indicates that crypto investors are reluctant to sell and that buyers are in search of new supply. The analysts added, “Therefore, it’s not surprising that the largest cryptocurrency reached its highest level of the year at $38,410 on November 24 due to Bitcoin investors becoming reluctant to sell and buyers entering the supply search.”
Standard Chartered Sees Bitcoin Moving Towards $100,000
Standard Chartered recently reported that its forecast for Bitcoin to reach $100,000 by the end of 2024 remains valid. Geoff Kendrick, Head of FX Research at Standard Chartered, believes that the main catalyst for the upward price movement will be the approval of at least one spot Bitcoin ETF in the U.S.
Kendrick and his team anticipate that the approval of ETFs may come sooner than expected. In their assessment, they predict that “a series of spot ETFs for both BTC and ETH will be approved in the first quarter of 2024, paving the way for institutional investment,” adding that “everything is proceeding as expected. BTC’s dominance continues uninterrupted, rising from the 45 percent level recorded in April to 50 percent.”
According to data provided by the crypto data and price platform CoinMarketCap, Bitcoin has risen by 2.87% in the last 24 hours, trading at $38,090. The data shows that the price of the largest cryptocurrency has increased by 4.29% over the last 7 days and by 11.70% over the last 30 days.
- Bitcoin’s velocity suggests long-term holding.
- Standard Chartered maintains a bullish BTC forecast.
- Spot ETFs could boost Bitcoin’s institutional adoption.
