Bitcoin will rise in 2023 – but be careful what you wish for

The Bitcoin (BTC) community is divided on whether the token’s price will rise or crash in the coming year. A majority of analysts and technical indicators suggest that it could bottom between $12,000 and $16,000 in the coming months. This correlates with a volatile macroeconomic environment, stock prices, inflation, Federal Reserve data and (at least according to Elon Musk) a possible recession that could last until 2024.

On the other hand, influencers, BTC maximalists and a host of other fanatical “shills” maintain that the price could skyrocket to $80,000 and more.

There is evidence to support both sides. One problem is that they can look at different time horizons. There are strong arguments that BTC is likely to fall sharply in the months ahead, but potentially rise in mid-to-late 2023.

The Case for a 2023 BTC Price Increase

Bitcoin bull runs historically coincide with the four-year market cycle, which includes accumulation (buying), an uptrend, distribution (selling), and a downtrend. We generally expect the accumulation part of this process to start in 2023, although some believe it may be delayed until 2024.

Related: What will the cryptocurrency market look like in 2027? Here are 5 predictions

Nevertheless, we are likely to see valuations rise in mid-2023, and there is evidence to support this idea. According to Kevin Svenson, we may witness a bull market begin around April when the 80-week bear market ends.

#Bitcoin Average Bear Market Length pic.twitter.com/3in9MsLaK2

— Kevin Svenson (@KevinSvenson_) 19 October 2022

Bitcoin’s deflationary nature, through its “halving” events, also encourages these price increases over time. (Halvings result in the reward for miners being cut in half. The next one is scheduled to take place in April 2024.) Despite market turbulence, Bitcoin’s deflationary nature results in price appreciation for long-term investors.

But be careful with the hype. Influencers and markets are well aware that greed sells. Predictions that Ether (ETH) will increase by 10 times in 2023 should be viewed with skepticism. And Bitcoin is highly unlikely to reach $100,000 or even close to it, despite such claims.

Pessimistic estimates have caused BTC to fall to $3500

Other experts suggest we won’t see a rise anytime soon or in 2023. Gareth Soloway of InTheMoneyStocks indicated there’s a small chance it could even plunge to $3,500:

“There will be a pivot in Bitcoin as it matures as regulation helps people feel more confident … I think in the short term we’re going to see a little bounce, then a wave down to $12,000 to $13,000, and then I do worry about you going below $10,000 to $8,000, maybe at worst $3,500 very small percentage, but it will be equivalent to Amazon.com collapse in the dot com era.”

If BTC plunges to $12,000 or lower, it may not be profitable for miners to operate the ecosystem. That would mean transactions would no longer be processed, a problem that could cripple the industry.

Let’s also remember that we haven’t seen a strong correlation between cryptocurrency prices and mass adoption, which is not a healthy pattern. Crypto prices have been a function of how much money – through derivative contracts and other financial instruments – investors (mainly whales and institutions) throw at given assets.

Changing times, but bullish sentiment

There are still other concerns that need to be addressed regarding BTC price cycles. Some suggest that these four-year cycles may no longer apply for various reasons. One is that most BTC is not the only child on the block, unlike previous cycles.

It competes against a number of cryptocurrencies that are superior in most ways, along with Decentralized Finance (DeFi), GameFi, Nonfungible Tokens (NFT), Decentralized Autonomous Organizations (DAO), Web3 startups and a number of far more lucrative investment mechanisms. Getting involved in Web3 and DeFi requires buying ETH, not BTC. Many assume that because people will become “more interested in DeFi”, BTC will rise. This is unfounded.

However, it remains one of the first coin institutions will gravitate towards when getting involved and a signature name in the cryptocurrency world. All things considered, it is likely that the Bitcoin price will rise in the middle of 2023, although we will see a fall in the coming months.

Related: The market doesn’t rise at first — so get used to dark times

On October 18, more than 38,000 BTC worth $750 million were removed from crypto exchanges to private wallets, a sign that whales are accumulating and hoarding during volatile times. Moves from stock exchanges are usually interpreted as bullish indicators. Robert Kiyosaki, author of Rich Dad Poor Dad, is bullish on BTC due to interest from institutions and pension plans. Like him tweeted on October 7:

“Why buy gold, silver, Bitcoin? Bank of England pivot means buy more GSBC. When pensions almost collapsed, it revealed that central banks can’t fix … INFLATION. Pension funds have always invested in G&S. Pension funds are now investing in Bitcoin. They know that fake dollars, stocks and bonds are toast.”

Why Buy Gold, Silver, Bitcoin? Bank of England pivot means buying more GSBC. When pensions almost collapsed, it revealed that central banks cannot fix … INFLATION. Pensjon has always invested in G& S. Pensjonsfond is now investing in Bitcoin. They know fake dollars, stocks and bonds are toast.

— therealkiyosaki (@theRealKiyosaki) 7 October 2022

An “end of world” BTC rise?

The irony of BTC maximalists is that they have a belief that a crash in existing systems and the US dollar (in particular) will be beneficial to Bitcoin and the wider “decentralized” community. They argue that a crash in governments will necessitate a new financial system, and Bitcoin is perfectly balanced.

The idea is that there is a nice inverse line between the collapse of the fiat infrastructure and an increase in the BTC price, where more volatility equals more price increases. When the world crashes, the decentralized society will simply “fill the void.”

Of course, a collapse in the oil USD will result in soaring energy prices. It would also mean a potentially unsustainable Bitcoin ecosystem due to mining issues. It’s a problem that Ethereum addressed with its September Merge, which removed miners from the equation and resulted in a 99.99% reduction of its carbon footprint.

And a complete collapse would also mean that valuations of the USD are worthless. If hyperinflation sets in, what value would $1 million in BTC have if it couldn’t be used to buy a loaf of bread? Volatility is usually Bitcoin’s friend – but only up to a point.

Bitcoin maximalists should be careful what they wish for: fulfilling their wishes could spell disaster for the USD and Bitcoin with it.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts and opinions expressed herein are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.