Price prediction Bitcoin 2021

Bitcoin Price Prediction for 2021 till 2025 | Forecast & Targets Bitcoin

The news surrounding Bitcoin (btc) has become much more active in recent weeks. Recently, the all time high has been broken again and again, but what are the expectations for the long term? More and more large investors are investing in crypto, and the mainstream media are also starting to pay attention to crypto. What does this mean for the price?

Since March 2020, the Bitcoin price has risen by about 300%. Many Bitcoin investors are wondering if this rise will continue in 2021, and the years after. Also, many people who have not bought Bitcoin yet but are interested in buying it are wondering what the real expectations are for the evolution of Bitcoin’s price in the next few years.

You just need to type keywords like “Bitcoin price forecast”, “Bitcoin price forecast 2021” or “Bitcoin price forecast” into Google to see how many predictions there are. If you read these forecasts, you will find that many analysts expect Bitcoin’s price to rise further in the years 2021-2025.

Below, we have listed some developments that are likely to push Bitcoin’s price up further in the years 2021-2025.

Explanatory factors why the Bitcoin price is likely to rise in 2021-2025

Bitcoin is gaining acceptance by financial institutions
More and more financial institutions are exploring opportunities to earn money from Bitcoin. This can be seen as a sign that Bitcoin is gaining acceptance in the international financial system. As a practical example, more and more banks in Europe are actively engaging with Bitcoin. In Switzerland, Maerki Baumann Bank, Incore Bank AG and Bitcoin Suisse are examples of this. In Liechtenstein, there is Banck Frick, which has even established a partnership with the Crypto-exchange Kraken.com.

Furthermore, the parent company of the US stock exchange NASDAQ, Intercontinental Exchange, set up a dedicated Bitcoin trading desk, Bakkt, in 2018. Also, large (US) investment funds such as Grayscale and SkyBridge Capital are investing ever larger amounts in Bitcoin. As a result, the total amounts invested in Bitcoin are getting higher and higher. This is different from the bull run that took place in 2017, when mainly individuals bought Bitcoin for lower total amounts.
Many analysts expect that in the coming years, more and more investment funds, High Net Worth Individuals, and institutional investors will find their way to Bitcoin. One example is Stone Ridge Asset Management, a US asset manager. In this very interesting letter, Stone Ridge explains to its shareholders why they think investing in Bitcoin is a good choice in many ways. Also, more and more banks are offering to hold Bitcoins for their customers. This may be attractive to banks, as Bitcoin is worth around $700 billion globally, and banks on average apply a 0.25% retention rate for their customers’ valuables.

Finally, crypto-exchanges Kraken.com and Gemini have obtained bank licences, perhaps the best example of Bitcoin gaining acceptance from the established financial, as well as political, order. Gemini now manages over $10 billion in client assets, and is committed to keeping client assets as secure as possible. Gemini is also committed to managing large crypto investments of institutional investors. Click here for an interesting interview with the Winklevoss-twins, founders of the Gemini Exchange.

More and more crypto-wallets
More and more crypto-wallets are emerging. These wallets allow users to securely store and trade bitcoins. The number of active wallets is also increasing, which means that more and more people are actively trading Bitcoin. It is likely that this will lead to an increase in Bitcoin prices in the long run because an increase in active wallets is the result of an increase in demand for Bitcoin. This page from Glassnode, a leading cryptocurrency data analysis firm, shows how more and more crypto-wallets have been added over time.
Fewer and fewer new Bitcoins
Due to a process called Halving, fewer and fewer new Bitcoins are created. The number of new bitcoins to be created decreases by 50% with each Halving. Therefore, with an increasing demand for BTC, Bitcoins are becoming relatively scarce. It is expected that in the long run the Bitcoin price will rise. In the Halvings that took place in 2012, 2016 and 2020, the price of Bitcoin increased each time. The next Halving is scheduled for 2024. Quant PlanB has developed its Stock2Flow model partly based on this scarcity principle. The word quant is an abbreviation of ‘quantitative analyst’, a collective term for brilliant data analysts, who usually work for financial institutions. PlanB published his Stock2Flow model in March 2019, and his model so far predicts the development of the Bitcoin exchange rate very accurately. The Stock2Flow model itself can be viewed on PlanB’s website. A discussion of the model, with short explanations, can be found here.
Loss of value money by inflation, search for Safe Havens
The Dollar and Euro, as well as other currencies, will probably become worth less and less because of inflation. This inflation is mainly caused by money presses that are currently being turned on, to stimulate economies during the Corona pandemic. This is currently already visible in the prices of shares, which have risen sharply since the start of the Corona pandemic. Due to this devaluation of money, and bubbles in various markets that are likely to occur at this time, investors are looking for safe havens for their money. Investing in Bitcoin can be an attractive option for them because historically, the price of Bitcoin has only gone up.

Gold is an example of a traditional Safe Haven, it is notable that Bitcoin is seen by many as the new gold, but a better version, Gold 2.0.

Bitcoin price forecast 2021-2025, conclusion

Bitcoin prices have fluctuated widely in the past. However, it is striking that over time a rising trend has always been visible. The question is why this will be different in the next 5 years. Bitcoin is out of the start-up phase, financial institutions see a lot of money to be made from Bitcoin, and more and more individuals in both Western and non-Western countries own Bitcoin.

Since the last bull-run in 2017, a number of striking trends have emerged, these trends collectively seem to point to a further rise in the price of Bitcoin in 2021-2025. A rise in the price in the coming years is therefore seen by many analysts as a realistic Bitcoin expectation. This is a good reason to keep an eye on Bitcoin developments in the coming years.

When will the stock market bubble burst?
There are more and more voices speaking out about the bubble that is now forming in the stock market. Many believe the economic recovery has been too swift after the blow we received from the introduction of the corona virus in late February and early March of this year.

Investors are said to be too optimistic and the stock market is said to be in for a serious correction soon. Although you often hear such statements about corrections, it could be serious now. Even Warren Buffet recently moved part of his assets from the stock market to gold, which may be an indication that he is feeling the wrath of the stock market.

Buffet has claimed in the past that both gold and Bitcoin are not good investments, so he is making a striking statement with this move. Many consider it possible that he might do the same with Bitcoin.

The actions of the world’s most respected investor are closely followed by many investors and often herald the start of a new trend. In addition, the stock market’s bull trend is now mainly driven by the unprecedented performance of a handful of giants, such as Amazon, Apple, Google and Tesla. The current growth of these companies may be distorting the true state of our economy, and this ‘bubble’ could burst sooner or later.

Therefore, in the event of a stock market correction, it is likely that many investors will turn to Bitcoin, which could result in a strong price breakout in the short term.

The halving of may 2020

In May last year, a so-called “halving” took place. This is a time when the reward miners receive for finding a new block is halved. To be clear, this is a halving of the reward, not a halving of the value of Bitcoin itself.

A new halving takes place every 4 years. The first time was on 28 November 2012, so this year was the third halving ever. This time, the reward was halved from 12.5 BTC to 6.25 BTC.

Why do these halvings exist?

Simply because of the principle of supply and demand. By halving the reward, the number of Bitcoins being created is reduced. This slows down the increase in supply while having no impact on the increase in demand. In this way, Bitcoin’s value cannot be plummeted by its own system, but can in principle continue to rise indefinitely.

How does a halving affect Bitcoin’s value?

Logically, if demand increases faster than supply, you will see an increase in value. That is exactly what happens after every half-life:

In 2012, the value of BTC went from $11 to $1000
In 2016, the value rose from $700 to $20,000
So why didn’t that happen this year?
There are many explanations for this, but these are the two main reasons:

This halving fell in a very difficult economic period this year. The whole world was still in semi-panic after the coronavirus hit, which put the economy in an unprecedented situation.
The entire Bitcoin network has ‘matured’. During the two previous halvings, the crypto currency was still young and the world had yet to learn about the effect of halvings. Now, not only investors but also Bitcoin companies are better able to assess the situation and are better prepared.
So, will there be no price increase after a halving?
Undoubtedly, yes. But the initial effect was less noticeable this year, as the halving occurred in the middle of the corona crisis. So a halving always triggers a bull run, which started again this year.

Thanks to this year’s halving, we can probably expect a further rise in BTC during the rest of 2020.

Bitcoin continues to grow through inflation

The main difference between Bitcoin and the dollar is that Bitcoin cannot simply be reflated when the global economy is in decline. In addition, the Federal Reserve can also ‘manipulate’ the value of the dollar by raising or lowering interest rates depending on what the economy needs at the time. The result: inflation.

New Bitcoins, on the other hand, are issued at a predetermined rate. This makes it possible to control depreciation and calculate inflation in advance.

Adam Back, a leading figure in the crypto world, even said in a recent interview that inflation will be one of the main catalysts for Bitcoin’s rise. According to Back, the Bitcoin exchange rate forecast for 2025 is as high as $300,000, which means a Bitcoin exchange rate in euros of about 115,000.

In the coming years (and maybe decades), the effective value of the dollar will continue to decline as more money is printed. With Bitcoin, however, the value will continue to rise, bringing more and more buyers into the market. Demand will then grow faster than supply, causing Bitcoin’s price to continue to rise.

Bitcoin is becoming more and more integrated into our society

More and more people are learning about Bitcoin digital as a means of payment and not just as an investment. Currently, it is mainly used as a payment method in the e-commerce market, but with the accelerated growth of e-commerce during and after the corona crisis in Q2 of this year, more transactions will also be made with Bitcoin.

In addition, many BTC platforms are also working on their merchant applications to make it easier for consumers to buy products using Bitcoin.

In short, the growing mobile payment market and the expansion of Bitcoin’s applications in our society may push the Bitcoin exchange rate to new heights in the coming years.

New highs in 2024

On top of inflation and a further expansion of the applications of BTC (and crypto-currencies in general) in our society, another halving will take place in 2024. Another halving means another opportunity for the Bitcoin exchange rate to gain some extra momentum.