Bitcoin’s price often mirrors the broader economy. Experts have noticed a trend: Bitcoin’s price tends to follow global liquidity trends, but with a delay of about 12 weeks. Right now, global liquidity is rising, suggesting good things for Bitcoin.
The Liquidity Factor and Bitcoin’s Future
Crypto analyst MartyParty highlighted a fascinating pattern: Bitcoin’s price (red line on the chart) closely tracks global liquidity (blue line), but lags by 12 weeks. With global liquidity increasing—and this increase isn’t coming from the US—MartyParty predicts Bitcoin could hit $125,000, driven by this foreign investment. A more optimistic prediction puts Bitcoin at $140,000 based solely on this foreign liquidity influx.
The US is expected to start injecting its own liquidity into the market in the next quarter, lasting 12-18 months. Coupled with potential interest rate cuts, this could send Bitcoin soaring to $250,000 in the medium to long term.
Bitcoin’s Steady Climb and Resilience
Daan Crypto Trades points out that Bitcoin has been remarkably resilient since its 2022 low, steadily climbing against the US stock market. It’s only had four minor corrections (20-30%), while gaining a whopping 420% overall. This suggests Bitcoin is becoming a more established growth asset, particularly when investors are feeling confident about the market.
Bitcoin Energy Value: A New High, But No Immediate Crash
Bitcoin’s “Energy Value” just hit a new all-time high of $135,000 per Bitcoin. Historically, such peaks have often been followed by significant price swings, either up or down. However, this time, the increase has been gradual and steady.
This suggests Bitcoin is stronger and more mature than before, with consistent growing demand. The current price is still about 15% below its Energy Value, leaving potential for further growth. Past cycles saw Bitcoin’s price peak 40-60% above its Energy Value. Despite years of predictions that Bitcoin was nearing its peak, these predictions have been consistently wrong, often followed by a surge in buying due to fear of missing out (FOMO).
