Bitcoin price could potentially rise above $50,000 in early 2024: CryptoQuant

A CryptoQuant report predicted Bitcoin BTC -2.03% could potentially exceed $50,000 early in 2024, from its current price of $43,000.

The prediction is based on analyzing Bitcoin’s user activity, using the Metcalfe price valuation band metric, considering factors like market capitalization, transaction volume, and user activity. The report suggested Bitcoin’s target price range could be $50,000 to $53,000 early next year.

"Bitcoin may be targeting $50,000 to $53,000 based on the network activity valuation perspective," CryptoQuant analysts said. 

Bitcoin supply in profit is now above 88%, according to the latest data from CryptoQuant.

Sell pressure may be rising

The report referenced the “bitcoin bull-bear market cycle indicator,” indicating a current bull market but nearing an “overheated bull phase” which historically aligns with price rally pauses or corrections.

CryptoQuant analysts noted that Bitcoin’s supply in profit is above 88%, and sell pressure may be increasing as a significant portion of circulating supply is in profit. The report, therefore, cautioned of potential short-term corrections, noting that high levels of circulating supply in profit often align with local market tops.

"Caution is advised due to the possibility of a short-term correction, given that 86% of the circulating supply is currently in profit and funding rates are noticeably elevated," the report said. Current data from CryptoQuant shows that the circulating supply of bitcoin in profit has now increased to over 88%. The report added that such high levels of circulating supply in profit "have historically coincided with local tops."

Bitcoin fell by over 2% on Thursday, trading for $43,100 at 7:10 a.m. ET. The entire cryptocurrency market capitalization is down nearly 1% today, now valued at $1.64 trillion.

Nmerous analysts maintain a positive outlook for 2024, a sentiment reflected in the recent surge in prices. This is attributed to a couple of key factors that may be driving the uptrend: the anticipated Bitcoin halving event scheduled for April 2024 and the possibility of approving a spot Bitcoin ETF.