Bitcoin could very well reach $220,000 in 2025, according to forecasts based on comparisons with gold. Analysts are increasingly considering the correlation between the leading cryptocurrency and the precious metal, and the results look quite optimistic for holders of digital assets.
Popular analyst on social network X under the nickname Apsk32 presented his model of the 'Power Law Price Curve,' according to which Bitcoin's four-year cycle should lead to a significant increase in its price this year.
Golden Parallel
The theory that Bitcoin follows gold to new historical highs is quite popular among optimistic investors. Historically, the BTC/USD asset mirrors the movements of XAU/USD with a lag of several months.
According to Apsk32, this time the consequences could be particularly impressive. Given that gold reached a record high of $3,500 an ounce, the future for Bitcoin's price dynamics looks more than promising.
"Bitcoin's position relative to gold has significantly improved since April," he wrote to his followers on X, presenting his 'Power Law Price Curve' tool. "It is this indicator that gives me hope for a higher-than-expected return by the end of this year."
The concept of the 'Power Law Price Curve' involves measuring the price of Bitcoin in ounces of gold to exclude the inflationary nature of the US dollar.
Model of the Power Law Relationship of Bitcoin Price. Source: Apsk32
"Here I measure the value of the Bitcoin network (market capitalization) in ounces of gold and fit this value to the power curve," Apsk32 explained in a separate post in March.
Among the results is a potential target mark for a bull market, which corresponds to the old maximum movement of 2017 at $20,000.
"If the value of the Bitcoin network, measured in gold, continues to follow the power law price curve, and gold maintains its current value, and the price of Bitcoin once again reaches a level corresponding to a five-year lead on the support line by the power model, we could see $444,000 as early as this year," the analyst added.
Power Law: Bitcoin's Market Capitalization in Ounces of Gold. Source: Apsk32
This week, Apsk32 suggested that a more 'justifiable' target for 2025 is $220,000.
"If we start climbing above $250,000, I would consider that 'higher than expected,'" he replied when asked about the prospects. "I really think we have a decent chance of reaching that level, just that it's not the most likely outcome."
Half of future gold capitalization = Bitcoin at $1 million
Continuing the topic of gold, Bitcoin analyst Sam Callahan examined data showing how high Bitcoin could rise if it captures various shares of gold's market capitalization.
This could happen thanks to the shift to 'digital gold' — a process that many expect to gain momentum in the coming years.
"If gold reaches $5,000 an ounce by 2030, and Bitcoin captures 50% of its market capitalization, that would place BTC at $924,000," said Callahan, based on data from the latest In Gold We Trust report released this week.
Gold/Bitcoin Matrix. Source: In Gold We Trust
The report states that the data does not represent a price forecast per se, but merely provides an idea of what the value of 'hard assets' might look like by the end of the decade.
The correlation of Bitcoin with gold continues to be an important factor in analyzing the long-term prospects of the cryptocurrency. Current forecasts point to the potential for significant growth in the coming years, with the possibility of reaching six figures by 2025 and approaching one million dollars by the end of 2030.