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Geoff Kendrick of Standard Chartered Sees $250K Bitcoin and $14K Ethereum Amid ETF Speculation

Last Updated March 26, 2024 4:39 PM
Teuta Franjkovic
Last Updated March 26, 2024 4:39 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Standard Chartered’s Geoff Kendrick noted Bitcoin’s 2024 surge, fueled by 11 ETF approvals and a record $73,000 price.
  • He is bullish on Ethereum due to potential in gaming and asset tokenization.
  • Kendrick discussed crypto market volatility, ETF investment trends (Bitcoin vs. gold), and investment dynamics.

This year, Bitcoin has seen a notable journey with a dramatic rise and minor corrections. The approval of 11 Spot Bitcoin ETFs injected unprecedented excitement into the market, driving BTC’s price to a record $73,000 and setting expectations for future growth.

Geoff Kendrick , from Standard Chartered, highlights this transformative period. He notes its impact on fueling optimism within the financial sector for Bitcoin and the wider cryptocurrency landscape.

Standard Chartered Raises Bitcoin Forecast, Sees Even Brighter Future

In an exclusive interview with CCN, Geoff Kendrick, the Head of Crypto Research and Emerging Markets (EM) FX Strategy at Standard Chartered, shares his expert insights into the remarkable journey of Bitcoin in 2024.

Standard Chartered, under Kendrick’s leadership in crypto research, has made a bold revision to its Bitcoin price prediction. First predicting a year-end price of $100,000 in November 2023, the bank has since adjusted its forecast, saying BTC should hit $150,000 in 2024.

Looking further, Kendrick and Standard Chartered see an even brighter future for Bitcoin. With expectations for the cryptocurrency to potentially reach $250,000 by 2025, the bank underscores its view of Bitcoin as a rapidly evolving asset class. This projection is partly based on the forthcoming Bitcoin halving event, which is expected to bolster the asset’s price further. Kendrick’s insights reveal a comprehensive analysis of the cryptocurrency market. It showcases Standard Chartered’s thorough research and strong belief in Bitcoin.

Bitcoin to $200,000? Analyst Sees ETF Boom, Gold-like Stability

Kendrick told CCN everything regarding his bullish forecast for Bitcoin, proposing a potential rise to $200,000. He attributed this projection to a triad of considerations. Initially, he highlighted the correlation between the cryptocurrency’s price and the influx of investments into exchange-traded funds (ETFs). This, Kendrick implied, was especially true after the launch of Bitcoin ETFs in the United States on January 11. Kendrick also pointed out the $11 billion net inflow into these ETFs and the resultant $25,000 increase in Bitcoin’s price. His analysis suggested that, as the ETF market matures, it could potentially accumulate between $50 billion and $100 billion. This could, in turn, drive the Bitcoin price upwards to about $250,000, possibly as soon as 2025.

Furthermore, Geoff Kendrick drew parallels between the growth trajectories of Bitcoin and gold ETFs. Noting the historical performance of gold following the introduction of its ETFs in the US, he suggested a similar multiplier effect could apply to Bitcoin.

Additionally, he discussed an asset allocation model comparing gold and Bitcoin. Kendrick suggested that current market dynamics indicate a potential for Bitcoin’s value to align more closely with gold, further supporting his target price.

He said:

“Part of the cycle has been downturns for Bitcoin. That says that right now you should have around 80% gold, 20% Bitcoin. The total gold value above ground is about $15 trillion. So, to get to 80:20, you can work out roughly where the Bitcoin value should be as well.

“Right now, the mix in total value is about 91% gold, 9% Bitcoin. So, obviously the Bitcoin price needs to go up to make up the difference there. If you assume gold prices go broadly sideways, that again gets you to about $200,000 on Bitcoin.

“For me, to have a few metrics that are pointing to something like $200,000 as being the medium term level, that tells me I should have that as my forecast for 2025.”

Kendrick’s comprehensive analysis considers various metrics and historical precedents. It culminates in a medium-term forecast that not only anticipates a significant rise in Bitcoin’s price but also suggests a stabilization period afterwards. He says that, after reaching a peak, possibly even overshooting to $250,000, Bitcoin’s price might enter a phase of less volatility, akin to gold’s price movements. This would see it establishing a new normal trading range around the $200,000 mark. This scenario reflects his expectation of a more mature and stable Bitcoin market post-2025.

10% Bitcoin Swings “Normal,” $60,000 Floor Holds Despite Dovish Fed

Speaking with CCN, Geoff Kendrick addressed the recent decline in Bitcoin’s price, which fell from above $70,000 to around $60,500. Kendrick interpreted this movement as significant but reasonable volatility for Bitcoin, characterized by an 80% pullback level. The downturn coincided with three consecutive days of net outflows from Bitcoin ETFs, a notable shift after a period of consistent inflows, highlighting a momentary shift in investor behavior.

Moreover, Geoff Kendrick commented on the broader market dynamics influenced by the Federal Reserve’s recent dovish stance , suggesting a potential boost for risk assets, including Bitcoin. Despite the volatility and outflows, he expressed confidence that Bitcoin would not fall below $60,000. Furthermore, he anticipated a recovery and the setting of new highs in forthcoming weeks. Kendrick characterized the observed 10% price fluctuations as typical for Bitcoin, suggesting an expectation of continued, albeit choppy, upward momentum in the near term.

Bitcoin 2.0? Less Risky Market, Stablecoin Influx vs. 2021’s ATH

Inquiring about the differences in Bitcoin’s current price  surge compared to its first all-time high (ATH) in 2021 , CCN queried Kendrick. He explained that the primary distinction lies in the composition of asset holders. He highlighted a significant influx of approximately $11 billion into spot exchange-traded funds (ETFs) since January 10, suggesting that this capital is likely to remain stable compared to leveraged futures positions.

Additionally, there has been substantial growth in open interest in both futures and options markets since the same date, indicating a potentially bullish sentiment.

Although the exact composition of these positions is uncertain, Kendrick assumed that most are long positions. Notably, the options market is deeper in this cycle compared to 2021. Moreover, he noted the absence of a spot ETF in the US during the previous ATH, suggesting that the current market mix is less risky.

He elaborated:

“In 2021, you got to a similar level in open interest in futures as we are just now, and the options market is deeper this cycle. So there’s more open interest in the options market.

In 2021, there was no spot ETF in the US, and so I’d say, on average, the mix now is less risky compared to where we were in 2021. So, because of that, I think we can keep pushing high.”

Despite anticipated pullbacks due to Bitcoin’s high volatility, Kendrick expressed confidence that such dips would be bought into, particularly following dovish remarks from the Federal Reserve.

Analyst Sees Altcoin Boom Fueled by Awareness

Kendrick also shared his insights on the topic of altcoins in the current bull market. In particular, he focused memecoins and their relationship to underlying blockchain technologies. Kendrick noted that the phenomenon of altcoins, which gained significant attention during the 2021 cycle, marked the first instance of such widespread interest in these cryptocurrencies.

He observed that Bitcoin’s rise typically precedes that of Ethereum and subsequently altcoins. This pattern has been consistent with the current market trends.  Kendrick saidthat altcoins have accelerated more quickly in this cycle compared to the last. He attributed this difference to a deeper market and greater awareness of altcoins.

He commented:

“You can certainly argue that the memecoins that are on Ethereum, for example, if they trade well, then that talks to the underlying confidence in the Ethereum network. In the same way, some of the new memecoins that have been very popular on Solana presumably talk to the confidence in the Solana network as well.

“So, I think in that case, the memecoin story makes some sense outside of that, given there’s no particular use case for the meme coins, as you could also argue for the likes of Bitcoin.

“It’s more speculative, if you like, for me, but so long as everything goes higher, they probably keep going higher.”

Kendrick expressed a nuanced view on memecoins, acknowledging the difficulty in assessing their fundamentals. However, he also suggested that the success of memecoins could reflect market optimism and confidence in their blockchain platforms.

For instance, the popularity of memecoins on Ethereum might indicate strong confidence in the Ethereum network. This is similar to how memecoins on Solana could signal trust in the Solana ecosystem. Despite the lack of specific use cases, Kendrick implied that, as long as the broader market sentiment remains positive, meme coins are likely to continue their upward trajectory.

Trump’s Return Could Boost Eth ETF? Analyst Sees SEC Uncertainty, Post-Election Shift

Kendrick talked about the United States Securities and Exchange Commission (SEC) announcing a new legal strategy to potentially classify Ethereum as a security. He discussed the potential ramifications this move could have on the cryptocurrency ETF market.

He also highlighted that the SEC’s classification of Ethereum as a security was not a foregone conclusion. Kendrick referred to the SEC’s previous attempt to classify 67 cryptos as securities during the Ripple case, noting that Ethereum was not among them. The uncertainty around Ethereum’s classification has led to mixed reactions, including pushback from the Senate regarding the approval of an Ethereum ETF.

Geoff Kendrick observed a noticeable shift in market sentiment, illustrated by the change in the discount to net asset value for the Grayscale fund, which reflects decreased market optimism about the approval of an Ethereum ETF by the specified date of May 23.

However, he speculated that prospects for an Ethereum ETF could improve significantly after the American Presidential election, especially if there’s a change in the executive.  Donald Trump’s potential return could lead to changes within the SEC that might favor the approval of an Ethereum ETF. Kendrick’s perspective underscores the fluid nature of the regulatory landscape for cryptocurrencies and suggests that timing plays a crucial role.

Ethereum’s Proof-of-Stake “Tricky” for SEC

The Standard Chartered crypto boss weighed in on the complexities introduced by Ethereum’s proof-of-stake mechanism and its implications for other cryptocurrencies utilizing similar consensus mechanisms. He said that Ethereum, unlike Bitcoin, shares similarities with various asset classes due to its proof of stake model. This, as a result, complicates its regulatory assessment. According to Kendrick, Bitcoin’s straightforward characteristics have led the SEC to compare it to commodities. This is because of its lack of yield, staking returns, and tangible real-world applications, akin to gold.

Kendrick elaborated that the inclusion of staking returns in Ethereum presents a regulatory challenge. He also suggested these might best be managed within actively managed portfolios or funds that broadly trade digital assets, akin to those managed by firms like BlackRock. He noted the existence of an ETF in Europe that incorporates Ethereum’s staking returns. On the other hand, he also mentioned that the fees associated with this ETF nearly cancel out the staking yields for the end user. Despite this, the concept of combining spot value with yield from staking presents a potential model for regulatory treatment, drawing a parallel with equity ETFs that include dividends.

Forget the May 23 ETF! Ethereum Chases Bitcoin in 2024, Eyes $14,000 by 2025 

Geoff Kendrick went on to elaborate on his price targets for Ethereum, sharing his perspective on its performance relative to Bitcoin in the coming years. He projected that Ethereum is likely to keep pace with Bitcoin through 2024, maintaining its price ratio even in the absence of an ETF approval on the speculated date of May 23. He anticipated Ethereum could reach a valuation of around $8,000 by the end of this year, assuming Bitcoin hits his forecast of $150,000.

Looking ahead to 2025, Kendrick identified real-world applications for Ethereum, particularly in the gaming sector. He pointed out that popular games like Minecraft, currently owned by mega-corporations such as Microsoft, represent a market ripe for disruption by Web3 technologies. Therefore, he suggests, Ethereum is poised as a key platform for next-generation games. This shift could tap into the gaming industry’s substantial revenue, which stands at about $300 billion. This could, therefore, be a first major use case for Ethereum beyond speculative trading.

Kendrick also mentioned the potential for tokenization of real-world assets on the Ethereum blockchain. Although this movement has begun, it still remains in its early stages. He predicted positive developments there could elevate Ethereum’s price ratio relative to Bitcoin to about 7%, a level last seen in 2021, by 2025. Based on his Bitcoin forecast of $200,000 for the next year, this adjustment could see Ethereum’s value soar to approximately $14,000. This, in turn, underscores the significant impact expected from the adoption of blockchain in gaming and asset tokenization.

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