Standard Chartered's team gives its predictions on Bitcoin and Ether

A new research team from the U.K.-based multinational banking and finance firm predicts that Bitcoin will hit $100,000 early next year.

Researchers at Standard Chartered have predicted that Bitcoin will hit $100,000 early next year and that the coin will take Ether with it. The team added that it structurally valued Bitcoin between $50,000 and $175,000, while Ether’s structural valuation is between $26,000 and $35,000.

A report released by the analysts on Tuesday suggests that Bitcoin, which has been trading around the $50,000 mark in recent days, could potentially rise to $175,000, in which case Ether could reach $35,000. Geoff Kendrick of Standard Chartered says the swing factor to watch is the halving that occurs every four and a half years.

“I think the main driver of the whole asset class is the cyclical nature of the halving of bitcoin supply, every four and a half years with the number of new bitcoins issued halving,” he noted.

Kendrick, who heads emerging market currency and crypto-currency research at the bank, estimates that in the near term, Bitcoin could reach $100,000 by the end of this year or early 2022. He adds that alongside this valuation forecast, Ether could reach $15,000 by the middle of next year.

The team at Standard Chartered believes that Bitcoin will emerge as the go-to option for peer-to-peer transactions in a cashless world. The research team also highlighted the lack of diversity in Bitcoin’s use cases. In this regard, the analysts said that with Bitcoin limited to peer-to-peer trades and use as a store of value, Ether’s ease of use could still allow it to play the role of a financial marketplace.

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ETH serves more as a facilitator of a larger software platform hosting a variety of decentralized applications (dApps) and contracts, which together constitute the Ethereum network. This gives rise to a much broader set of use cases,” the report states.

The researchers also observed that with Ethereum, the risks would be higher given that the SEC’s regulatory efforts are planned to classify it as a stock in the future.

“There is clearly a risk with Ethereum that at some point the SEC will consider it equivalent to equities ,” Kendrick told clients.

Standard Chartered has already found its place in the crypto space, having announced earlier this year its own digital asset brokerage and exchange platform for clients institutional.