Crypto Bull Rally: Will Bitcoin Cross $100,000 In 2023?
By Benzinga
Not everyone has suffered from the recent banking crisis. Crypto aficionados have emerged as a fortuitous winner, with Bitcoin, the largest cryptocurrency by market cap, soaring nearly 70% year to date.
Institutional traders believe the brutal year-long crypto winter has finally come to end, with the current macroeconomic backdrop reflecting a trend reversal.
2023 Crypto Rally
Bitcoin hit an all-time high of $68,991 in November 2021 before the onset of the brutal crypto winter. But recent market conditions have resulted in investors singing a different tune, touting Bitcoin to be a safe-haven asset and a store of value. While many have heralded Bitcoin as a hedge against inflation, the Federal Reserve’s aggressively hawkish stance caused decentralized tokens to fall out of favor last year.
In the wake of the recent banking crisis, analysts predict the Fed will slow its rate hike trajectory. Bitcoin also has long been considered a store of value. Other popular cryptocurrencies including Ethereum (ETH/USD) and meme token Dogecoin (DOGE/USD) have also fared well. Goldman Sachs stated recently that cryptocurrencies hold a 20% market share as a store of value.
Other blockchain-based assets have been performing strong as well. Gameflip is a gaming and NFT marketplace with over $160 million in lifetime volume on their platform. The startup also has a live StartEngine raise, which means anyone can invest for a limited time. The startup is nearing $1 million raised in it’s current round from retail investors.
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BTC: The New Digital Gold
Last month’s banking crisis exposed the systemic weakness in the global banking system as behemoths, including the second-largest Swiss bank Credit Suisse and the then 16th-largest U.S. bank Silicon Valley Bank, closed their doors. The benefits of decentralized tokens have been highlighted in the wake of the recent bank failures, with many proclaiming Bitcoin to be the new digital gold.
“I think the rally is explicable by saying people have got freaked out by the banking system by the collapses,” said Oliver Linch, CEO of Bittrex Global.
Changpeng Zhao, co-founder and CEO of Binance, considers Bitcoin to be better than gold.
As the crypto rally takes off, analysts and institutional investors are betting on Bitcoin to reach its all-time high again this year.
“I think Bitcoin probably breaks all-time highs this year,” said Marshall Beard, chief strategy officer of cryptocurrency exchange Gemini, adding that the cryptocurrency could hit the $100,000 mark.
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Vijay Ayyar, head of international at crypto exchange Luno, said, “Broadly, we are looking quite bullish here with Bitcoin reclaiming $28K and looking to target $30K next.”
On March 17, Balaji Srinivasan, former technology chief at crypto exchange Coinbase, bet $2 million that Bitcoin could cross $1 million in just 90 days, as hyperinflation kicks in. Notably, Bitcoin would have to surge by nearly 3,500% within the next three months to reach this mark.
The blockchain-based gaming market is expected to benefit from the crypto rally to hit a $50 billion valuation by 2025. This marks a 33 times rise from the $1.5 billion market size reported in 2021.
Fed Scaling Back And Future Of Crypto
The Fed’s dovish stance is expected to fuel the bullish case for crypto, as decentralized currencies regain momentum. Typically Bitcoin has outperformed other major asset classes in a bull market.
“Any time that you’ve held Bitcoin in a four-year rolling interval, so you pick the day, hold it for four years, you’ve outperformed every other asset class,” stated SkyBridge Capital Founder and Managing Partner Anthony Scaramucci.
But the disappointing jobs report and weak economic data published earlier this week has steered investors to reliable asset classes, including gold. As recession fears set in, crypto could see a massive influx of investments, as people continue to bet on decentralized assets.
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Tensions Ahead
The U.S. Treasury has deemed decentralized finance (DeFi) markets a threat to U.S. national security, citing the requirement of further regulatory oversight. This, coupled with the U.S. Commodity Futures Trading Commission’s lawsuit against Binance, signals significant regulatory headwinds ahead for the crypto industry. But as the U.S. dollar slides amid Fed’s easing monetary stance and macroeconomic jitters, Bitcoin might hold its position as the best-performing asset in 2023.
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