Standard Chartered, one of the world’s leading banks, has its long-term Bitcoin price forecast, predicting that the value of the flagship cryptocurrency could reach $120,000 by the end of 2024. This upward revision comes as the bank acknowledges the potential for miners to hold a larger share of the newly minted Bitcoin supply.

With the recent surge in Bitcoin’s price, Standard Chartered sees an opportunity for miners to reduce their selling activities, which could have implications for the cryptocurrency’s scarcity and future value.

Miners’ Role In Bitcoin Value Proposition

Miners hold a significant position within the crypto ecosystem, as they are responsible for the creation and upkeep of the network. And Standard Chartered’s forecast of Bitcoin reaching $120,000 by the end of 2024 is rooted in the notion that miners may adapt their selling practices to cover operational expenses, particularly the costs of electricity required for mining activities.

Related Reading: Standard Chartered Predicts Bitcoin Could Reach $100,000 By End of 2024

By reducing the portion of newly generated Bitcoins they sell, miners can balance their cash inflows while simultaneously decreasing the overall supply of Bitcoin available in the market. This adjustment in selling behavior has the potential to impact the supply-demand dynamics of Bitcoin and potentially contribute to a surge in its value.

The rationale behind Standard Chartered’s prediction lies in the assumption that miners, who currently produce approximately 900 new BTC daily on a global scale, will opt to hold onto a larger portion of their newly minted coins. By doing so, they can cover their operational costs more efficiently.

If this adjustment occurs and the proportion of BTC sold by miners decreases, it could lead to a reduction in the net supply of Bitcoin by roughly 250,000  BTC per year. Such a decrease in supply has the potential to exert upward pressure on the value of Bitcoin as demand potentially outpaces the available coins in circulation.

Factors Driving Standard Chartered’s Optimism

Standard Chartered’s revised forecast is underpinned by the expectation that increased profitability for miners per Bitcoin mined will encourage them to hold onto a larger portion of their newly minted supply.

Geoff Kendrick, a top FX analyst at the bank, suggests that as Bitcoin’s price approaches the $50,000 threshold, miners may reduce the proportion of BTC they sell from 100% to approximately 20-30%. This reduction in daily supply, from 900 BTC to a range of 180-270, would equate to a significant reduction in net BTC supply of roughly 250,000 BTC per year.

Furthermore, Kendrick points to an upcoming event that will halve the number of BTC that can be mined each day, which is an intrinsic feature of Bitcoin’s design. This mechanism, known as the “halving,” gradually limits the supply of new BTC to maintain scarcity and mitigate inflation.

By combining the potential reduction in miner selling with the forthcoming halving, Standard Chartered anticipates an environment conducive to a sustained increase in Bitcoin’s price over the long term.

Meanwhile, over the past day, Bitcoin has traded below the $31,000 level particularly, with a market price of $30,441, at the time of writing.  Nevertheless, the asset is seeing 1% gains in the last 24 hours with a 24-hour trading volume of $10.6 billion.