7 Factors May Send BTC to $42k in 2023
Researchers at the South Korean crypto exchange Bithumb have named seven factors they believe will affect bitcoin (BTC) and crypto prices in 2023 – and determine whether the bear market will give way to bullish forces for a sustained period.
The crypto exchange’s researchers claimed that bitcoin prices could rise to the $42,000 mark in the next 12 months – provided certain events come to pass.
Per Asia Today, the predictions were published in a report named 2023 Virtual Asset Market Outlook, published by the Bithumb Economic Research Institute.
The company graded each factor with a star rating out of four, with four stars denoting an event with maximum significance on the market. It also categorized the events as Bearish, Unknown, Neutral, or Bullish.
Four-Star Bulls
Bithumb identified potential two four-star bull events that could help spur BTC prices toward $42k. The first was the Federal Reserve’s forthcoming decision to ease “austerity measures.” The second was whether or not Russia will green-light its trading companies to use cryptoassets as a means of settlement in cross-border deals.
The Fed is widely expected to cut interest rates sometime this year – a move that many experts claim will encourage investment in crypto, and spark a prolonged recovery for major tokens.
Russia, meanwhile, has been frozen out of dollar-powered trading in most markets. But crypto-powered trade deals could provide an alternative for Moscow – despite some uncertainty from the nation’s crypto-skeptic Central Bank.
Three-Star Bulls
Two other events could have a significant impact on crypto prices, Bithumb researchers explained. These include a possible easing of crypto tax rates in Japan, which could spark an Asia-wide bull market.
Tokyo has indicated that it will review tax rates on corporate entities that issue and hold crypto. A move to reduce individual investors’ tax burden may be more problematic, but opposition MPs have repeatedly called for the government to change its stance.
The other three-star bull is Brazil, where plans to grant crypto a greater legal footing could also revive flagging Latin American markets.
The ‘Unknown’ Factor
Bithumb researchers claimed they were unsure how the result of the Securities and Exchange Commission (SEC) versus Ripple battle would affect markets. But they rated this event as a three-star factor, indicating that the court’s ruling would hit prices one way or another.
A Significant ‘Neutral’ Event?
The Ethereum network’s first major upgrade of the year has been dubbed “Shanghai,” a hard fork that is scheduled to take place sometime in March. This will allow validators to withdraw ethereum (ETH) holdings they have staked to secure the network. While the research team thinks this will not necessarily send the market up or down, the event could well have a stabilizing effect.
And that, perhaps, is why the team graded the hard fork as a three-star event.
The Bear in the Room
It is looking likely that the Mt. Gox exchange compensation payout will finally take place this year, with a March payout the most likely outcome. This would essentially see BTC 140,000 BTC “released to the market” from March, with payouts to continue until late September.
“As it is difficult for creditors to guess when the coins will be sold, caution is needed,” the researchers were quoted as stating. This factor was graded as a two-star bear event.
Bitcoin Outlook in 2023
Lee Mi-sun, the Head of the Bithumb Economic Research Institute’s research team, was quoted as stating that if conditions were favorable and “clearer” crypto regulations were put in place, “more countries and institutions will be able to incorporate virtual assets into their portfolios this year.”
But she warned that the “price outlook may be affected if unforeseen variables occur.” Lee said these variables could include a drop in Bitcoin network usage due to the “emergence of new, alternative assets.”
