Will Bitcoin reach $100,000?

Tags: bitcoin

Bitcoin (BTC) has come close to hitting the $100,000 mark, a milestone previously considered unattainable by many. Just a few years ago, only the most optimistic in the industry dared to imagine Bitcoin approaching $100,000—but now, that prospect has become a tangible possibility.

Let’s revisit Bitcoin’s past all-time highs and compare the current period to what has happened before. Understanding Bitcoin’s behavioral patterns will help us predict whether history will repeat itself.

The question is: Will this repeat? Or are we at a singular point in time—akin to futurist Ray Kurzweil’s vision of artificial intelligence surpassing human intelligence? If Bitcoin, like AI in that scenario, has entered uncharted territory, can we envision a future far beyond our current understanding?

1. OVERVIEW OF BITCOIN’S BULL AND BEAR CYCLES

Starting in 2013, Bitcoin reached $266 in April, but within weeks plummeted approximately 75% to around $65. Later that year, it surged to $1,150 in December before entering a prolonged bear market, dropping approximately 85% to $170 in January 2015. Factors such as market speculation, regulatory uncertainty, and the collapse of the Mt. Gox exchange are believed to have influenced this price volatility.

Continuing with its peaks and troughs, in December 2017, Bitcoin reached an all-time high of $20,000, fueled by the investment frenzy from retail investors and the explosion of Initial Coin Offerings (ICOs).

However, a sharp correction followed, with Bitcoin’s price falling by as much as 84% by December 2018. Coupled with market saturation and investor fatigue, these factors led to the collapse of the once-booming ICO market. This correction not only wiped out billions of dollars in value but also dragged Bitcoin’s price down to levels unseen since the previous cycle, reaching just $3,200 by the end of 2018.

In 2021, Bitcoin experienced a series of significant fluctuations with multiple highs and lows, highlighted by two all-time highs and sharp corrections. In April, Bitcoin hit an ATH of $64,000, driven by increased adoption from institutions and excitement surrounding the cryptocurrency market.

However, by July, the price had fallen 50% to $30,000 due to profit-taking and concerns over regulatory crackdowns. The market recovered later in the year, reaching another ATH of $69,000 in November, but this rally was short-lived.

With Bitcoin’s price plunging 77% to $15,500 in November 2022. As we can see, external shocks always play a role in bursting Bitcoin’s speculative bubbles. The crash from 2021 to 2022 was a perfect storm of rising interest rates coupled with the spectacular implosion of the crypto industry, such as the Terra and FTX collapses.

This was a repetition of history, with the post-2022 bear market focused on regulatory clarity, layer-2 solutions, and institution-grade infrastructure, preparing the industry for its current growth phase.

Bitcoin’s bull cycles are increasingly longer, with the uptrend lasting 334 days in 2013, 1,065 days in 2017, and 610 days in 2021. Similarly, correction periods have shown consistency at around one year for recent cycles, reflecting increasingly longer and steadier market trends as the cryptocurrency market matures.

While corrections remain sharp, the volatility range has decreased as institutional investors begin to stabilize the market.

2. WHAT MAKES THE CURRENT CYCLE DIFFERENT?

So, what are we witnessing now? Previously, Bitcoin was dismissed as a scam, a fad, but now Bitcoin is proving its critics wrong. There’s a clear shift in the narrative surrounding Bitcoin, from a speculative asset to “digital gold” or a long-term store of value.

In November 2024 alone, spot Bitcoin ETFs attracted a record $30.814 billion in inflows from major investors such as BlackRock, Fidelity, Valkyrie, VanEck, Invesco, Bitwise, Franklin Templeton, WisdomTree, and ARK Invest.

These ETFs have shown significant daily trading activity, with BlackRock leading the pack by accumulating $31.333 billion this month, followed by Fidelity with $11.538 billion and Bitwise with $2.432 billion. Their presence has significantly mitigated volatility and contributed to market stability.

Furthermore, public companies are increasingly active in incorporating Bitcoin into their treasuries. In total, public companies—primarily US-based corporations—currently hold 361,991 BTC, representing 1.83% of Bitcoin’s total supply, worth approximately $34.76 billion, according to data from CoinGecko.

MicroStrategy remains the leader, holding a staggering 252,220 BTC, accounting for over 70% of the total Bitcoin held by public companies and representing 1.201% of Bitcoin’s total supply.

Following MicroStrategy, Marathon Digital Holdings ranks second with 26,842 BTC, while Galaxy Digital Holdings holds 15,449 BTC in third place. Tesla remains a significant player in fourth place with 11,509 BTC.

Top Public Companies by Bitcoin Holdings (BTC). Source: CoinGecko

According to the Sygnum Future Finance 2024 survey, institutional investors increasingly view digital assets as a significant part of their portfolio, with 57% intending to allocate more and 81% seeking better information to guide their strategy.

Glassnode’s report highlights how institutional inflows, particularly through US spot Bitcoin ETFs, are reshaping the Bitcoin market by stabilizing price swings and absorbing sell pressure.

Over the past 30 days, ETFs absorbed 128,000 BTC, accounting for 93% of the 137,000 BTC sold by long-term holders during this period. Weekly inflows into Bitcoin ETFs have surged to $1 to $2 billion, playing a crucial role in maintaining liquidity and supporting the price rally to as high as $93,200.

However, with long-term holders still controlling 14 million BTC, their profit-taking poses a challenge to institutional demand, which is crucial in determining whether the current rally can sustain its momentum.

3. BITCOIN NEARING THE $100,000 MARK

Based on data from Bitcoin options contracts, open interest reflects a strong focus on high price levels, with significant activity concentrated around $100,000 and $120,000.

At the $100,000 price point, open interest shows 20,600 call options versus 1,530 put options, indicating strong bullish sentiment.

The market value of call options stands at $159.45 million, far exceeding the market value of put options at $13.43 million, with a total notional value of $2.12 billion.

Similarly, the $120,000 strike price shows 18,310 call options versus 764.5 put options, with a total notional value of $1.83 billion and a market value of call options at $115.29 million. This overwhelming dominance of call options at these high strike prices further reflects the market’s strong bullishness on Bitcoin’s potential to reach or surpass these levels.

4. CONCLUSION

Bitcoin’s price trajectory towards $100,000 represents a significant evolution. The impressive milestones achieved—such as $30.814 billion in inflows into Bitcoin ETFs this November, the significant accumulation of 361,991 BTC by public companies, and $2.12 billion in open interest at the $100,000 strike price—highlight a maturing market that is moving beyond speculation to become a credible asset class.

Whether Bitcoin’s price surge is fueled by repeating history or making new history, one thing is certain: the path to $100,000 is no longer a question of “if” but “when.”