The global financial landscape is abuzz with predictions about Bitcoin’s future, notably from a recent research paper by Geoff Kendrick, Global Head of Digital Assets Research at Standard Chartered Bank. The paper, dated October 24, delves into the potential for Bitcoin to reach a staggering $125,000 by the end of the year, especially if former President Donald Trump secures a victory in the upcoming US presidential election.
When Bitcoin Could Hit $125,000
Kendrick’s analysis intricately ties Bitcoin’s price movements to the US political climate, specifically the upcoming presidential election. In his report titled “Bitcoin – Post-US Election Playbook,” he reveals, “We use daily BTC vol levels and popular strike levels to estimate post-election price moves.” Bitcoin’s value has shown an upward trend in recent weeks, a movement that aligns with trades favored by Trump supporters.
The report anticipates Bitcoin reaching roughly $73,000 by Election Day on November 5, closing in on its all-time high of $73,800 noted in March. Kendrick states, “Our base case is that Bitcoin rises to around $73,000 by Election Day, catching up to betting-market probabilities of a Trump win.”
Related Predictions
Betting markets have shown a growing confidence in a Trump victory. “The average betting odds of a Trump victory now stand at 59%, according to RealClearPolitics. Moreover, conditional probabilities in specific betting markets (Polymarket) suggest a 75% chance of a Republican sweep if Trump wins the presidency,” the report highlights.
Should Trump emerge victorious, Kendrick foresees an immediate bullish push for Bitcoin. “Assuming a Trump victory, options break-even implies a further price rise of about 4% when the presidential outcome is known, and around 10% in total within a few more days,” he explains.
The Impact of a Republican Sweep
A Republican sweep of Congress could further bolster this optimistic forecast. “If the Republicans sweep Congress, our year-end target level of USD 125,000 should come into view,” Kendrick asserts. This scenario is supported by significant open interest in Bitcoin call options set to expire on December 27 at the $80,000 strike price, indicating rapid movement toward that level.
What If Harris Wins?
Conversely, if Vice President Kamala Harris wins the election, the report suggests a short-term dip for Bitcoin prices. “If Harris wins, we see BTC initially trading lower but still ending 2024 at fresh highs around $75,000,” Kendrick projects. This reflects a robust long-term outlook for Bitcoin, regardless of the election outcome, albeit with varying degrees of gains.
Kendrick underscores the importance of options market data in predicting potential price shifts. “Options info helps estimate initial post-election price moves,” he states. The substantial trading volumes and favored strike levels act as indicators of investor sentiment and market positioning ahead of the election.
Current Market Trends
The recent dip in Bitcoin’s price to a local low of $65,200 was addressed in Kendrick’s report. He believes this is “likely to be the last before the U.S. presidential election,” suggesting that any short-term corrections may be eclipsed by the upcoming political events.
At the time of writing, Bitcoin was trading at $67,520.
