- Bitcoin miner predicts a more stable Bitcoin market post-2024’s halving
- According to Thiel, BTC might hit new highs by the end of 2025
During a recent episode of The Pomp Podcast, Fred Thiel, Chairman and CEO of Marathon Digital Holdings (NASDAQ:MARA), highlighted that the upcoming halving positions Bitcoin (BTC) for a higher appreciation rate. This, compared to gold. Additionally, it can be expected to allow for more stability during market downturns.
“The one unique thing that Bitcoin has that equities don’t have is that finite number of Bitcoin.”
The expansion of Bitcoin’s supply will be slower than the growth in gold’s supply in the gold market. This will have greater implications on its price, he said.
What’s different about the 2024 Bitcoin halving?
Traditionally, halvings have led to a surge in BTC prices, offsetting miners’ revenue losses. However, Thiel drew attention to the introduction of Bitcoin exchange-traded funds (ETFs).
According to the exec, these financial instruments will likely lead to greater liquidity and reduced volatility. This will also make the cryptocurrency more appealing to institutional investors. This shift is further amplified by trading activities around ETFs, like transitions from Grayscale to lower-fee options.
Finally, Thiel stated that diverse investment options, including direct Bitcoin holdings, Futures markets, and diversified ETF baskets, underscore its growing integration with mainstream financial systems.
Miner strategies in the new era
The exec also shed light on the current game plan for Bitcoin miners, which is evolving beyond traditional utility-scale mining. Now, miners are increasingly focusing on “energy harvesting.” Looking ahead, the vision is for Bitcoin mining to resemble micro-grids. By tapping into widely dispersed, stranded energy sources, miners can operate more sustainably, potentially reaching zero-cost Bitcoin mining.
This shift would significantly enhance the security of the Bitcoin network.
“…making it the most secure network in the world.”
Macro-environment and Bitcoin
Thiel believes that the price of BTC and the global hash rate are pivotal factors in the Bitcoin mining industry. These elements affect miners’ capital acquisition capabilities and the price of mining equipment. Despite these challenges, however, BTC has proven to be a strong investment over the last decade.
“Bitcoin is the best investment going back 10-15 years that anybody could have, but the question is, are you willing to put up with the risk that you may have.”
Even so, global geopolitics, the USD’s strength, inflation rates, and external factors like energy prices and trade dynamics, largely outside the Federal Reserve’s control, can significantly influence Bitcoin’s attractiveness. These factors, combined with Bitcoin’s inherent volatility and the fluctuating global hash rate, contribute to the cryptocurrency’s fluctuating appeal in different macroeconomic scenarios.
Outlook for 2024: Stability and growth
What next for Bitcoin in 2024 then, especially after the halving? Well, the exec believes,
“I’m not going to be the one calling for $1 million Bitcoin at the end of the year. I think it’s going to be a much more modest number….we’ll start seeing institutional money start coming in slowly but surely…the transaction volumes and inflows will grow over time which is all going to be good for Bitcoin.”
Thiel also shared a cautious, yet insightful price prediction for Bitcoin during the Pomp podcast. He is expecting the king coin to hit an ATH by the end of Q3 or early Q4, before experiencing a sell-off that could bring its value down to the mid-40s or low 50s.
According to Thiel, this trend will stabilize into early 2025, followed by a gradual ascent. In doing so, it will touch a new ATH in the $120,000-range by the end of 2025.