Bitcoin (CRYPTO: BTC) is not an asset that only appreciates in a speculative frenzy. In fact, some structural forces currently benefiting it could push its price beyond $250,000 in the next 18 months. This figure is about 2.5 times its current price of around $106,000.

Here are three of the most important forces. Note that all three of these forces will continue to play out in the long term, which will support higher prices whether or not the coin surpasses the arbitrary threshold of $250,000 by the end of 2026.

1. Scarcity

The issuance of Bitcoin is encoded in its protocol to halve every four years; the most recent halving occurred in April 2024. Currently, the block reward is so small that annually, it generates new supply of about 1.8% of the total. And there can only be 21 million Bitcoins in existence, of which 19.9 million have been mined. The supply is diminishing and even less will be produced in the future.

History shows that previous halving events tend to precede significant price increases, and there is no reason to believe that this trend will stop. At the same time, even without a recent halving, buyers still need to compete with each other to purchase coins because the supply is locked in the hands of long-term holders, who simply do not sell -- or have lost their coins.

These supply dynamics create a powerful mix of upward price pressure even without many new buyers bringing in capital. If those new buyers do appear -- as they are currently doing, based on the coin's high price -- then not much new marginal demand is needed to drive significant increases.

2. It Can Hedge Against Inflation

As briefly discussed above, Bitcoin is inherently deflationary rather than inflationary like fiat currency. And although it has not fully proven to be a complete store of value in purchasing power as measured by fiat currency, it likely is, simply because it cannot be printed and is scarce.

The weakness is the volatility of Bitcoin. This asset has lost up to 80% of its value multiple times and it is likely to lose it again. Of course, it has recovered and continues to reach new highs each time, but one cannot rely on it doing so in the future within any specific timeframe, although it may eventually recover.

However, in the coming years, concerns about inflation may arise again. Increasing trade tensions in the United States as well as financial issues such as the country's national deficit will be conveniently addressed by printing money faster than investors would like. With the issuance of more currency potentially coinciding with a new era of Bitcoin adoption, the value of this coin as an inflation hedge will soon be tested - and is likely to push its price higher.

3. New Holders Are Emerging

The ultimate trend that could double Bitcoin's price before the end of 2026 is the emergence of new holders with deep pockets.

Institutional investors in finance, governments, and large companies worldwide are choosing to buy or hold Bitcoin. Overall, these players do not dump their coins at the first sign of trouble because they can borrow fiat money by using their Bitcoin as collateral. Additionally, they can bring much more capital to endure compared to individual investors.

As their shopping activity increases, especially in countries with large parts of the financial system, like the United States and China, this will create more competition for a smaller group of coins. That competition is happening right now and will continue to accelerate for at least the next year or longer. And that is a significant force driving prices higher, potentially even up to $250,000.