Mark Yusko, CEO of Morgan Creek Capital Management, has provided an explanation for his bold prediction that Bitcoin will reach $150,000. In a recent interview on CNBC, Yusko was asked to clarify the mathematics behind his forecast.
Yusko revealed that his prediction is based on Metcalfe’s law model, which suggests that the fair value of Bitcoin is approximately $50,000. He also mentioned that the upcoming halving, which is just three weeks away, is another factor that contributes to his outlook.
The halving event reduces block rewards, which are the amount of money given to miners for securing the Bitcoin network. According to Yusko, this reduction in rewards historically leads to an increase in the price of Bitcoin and its fair value.
However, Yusko acknowledged that this cycle is slightly different due to the emergence of transaction fees alongside block rewards. Taking this into account, he envisioned a scenario where Bitcoin’s fair value would only reach $75,000 in this cycle. He attributed this to the expected surge in interest following the halving, as many people would experience the fear of missing out (FOMO).
Yusko also noted that Bitcoin has historically reached about twice its fair value in each cycle. For example, in the 2021 cycle, BTC’s fair value was estimated at $30,000, but the asset peaked at around $69,000. Based on this pattern, Yusko believes that a two-times fair value scenario would make his $150,000 prediction achievable.
It is worth mentioning that other prominent entities in the crypto space, such as Standard Chartered, Tom Lee, and Robert Kiyosaki, also share the belief that a $150,000 Bitcoin is possible in this cycle.
When asked about the timeline for reaching $150,000, Yusko explained that the significant price movement typically occurs after the halving. He expects demand to surge due to ETFs and other interested parties, while the supply of new coins decreases. Yusko emphasized that for the price to rise, there needs to be more demand than supply. He anticipates a more exponential or parabolic ascent towards the end of the year.
Yusko added that historically, Bitcoin’s peak occurs approximately nine months after the halving, towards the end of the year, before the start of the next bear market.
In conclusion, it is important to note that this article is for informational purposes only and should not be considered financial advice. The views expressed are the author’s personal opinions and do not reflect the opinion of The Crypto Basic. Readers are advised to conduct thorough research before making any investment decisions, and The Crypto Basic is not responsible for any financial losses incurred.