Bitwise CIO: Three things are needed for Bitcoin’s “melt-up” to $80,000 in Q4

• Matt Hougan has said three factors will push Bitcoin to $80,000 by the end of 2024
• Hougan indicated that the US election is a big deal for crypto
• Altcoins could also help bolster the melt-up case for Bitcoin achieving new highs

Bitwise’s CIO has indicated three things that could see Bitcoin achieving highs of $80,000 by the end of 2024.

In a client memo, Matt Hougan said that the US election, the economy, and no negative crypto surprises are what may see a “melt-up” of Bitcoin to trade above $80,000 during the last quarter of 2024.

At the end of 2023, Bitwise predicted that Bitcoin would reach $80,000. He also indicated that spot Bitcoin exchange-traded funds (ETFs) will be approved.

In his latest memo, Hougan stood by his belief that Bitcoin will reach all-time highs. Writing about the US election, the CIO stated that while a Republican win would be good for the crypto market “given the GOP’s strong and growing advocacy for the space,” the election is “more nuanced on the Democratic side.”

He added that the Democrats have “disparate views on crypto” from Senator Elizabeth Warren’s “Anti-Crypto Army” to Representative Ritchie Torres’ deep support of the market.

“To thrive, bitcoin doesn’t need politicians,” Hougan said. “It just needs them to get out of the way. And barring a Democratic sweep of both houses of Congress and the White House, I suspect they will, with the Democrats taking a more neutral approach to the industry.”

Recent data shows that former US President Donald Trump leads the election against Vice President Kamala Harris on Polymarket, the decentralized prediction market platform.

Lack of trust

Turning to the economy, Hougan stated that the US Federal Reserve’s rate cuts by 50 basis points and China releasing two trillion yuan in economic stimulus in late September fueled the crypto rally.

Hougan added that the market expects a further 50 basis points by the end of 2024 from the Federal Reserve and additional fiscal stimulus in China.

Looking to his third point, Hougan indicated that a Bitcoin rally to $80,000 would be achieved if there are no major surprises, no lawsuits, and no locked coins entering the market. However, he noted that the crypto industry is full of surprises that have impacted the market.

“Over the past few quarters, the release of previously locked-up bitcoin from failed exchange Mt. Gox and from government coffers has contributed to keeping us range-broad,” he said.

Altcoins could help

In Hougan’s view, aside from the three factors above, a broader rally in crypto will help seal the deal of Bitcoin reaching $80,000.

“Bitcoin doesn’t need Ethereum, Solana, or novel altcoins for its long-term success,” he added. “But if we’re going to get a full-on melt-up in the short-term – say, a rip to $100,000 in just a few months – it would help to have a bit of pro-crypto sentiment sweep the market.”

While he believes those crypto “animal spirits” have been in short supply during 2024, he sees them rising in areas such as stablecoins and projects including Sui, Aptos, and Monad.

“Strong and sustained momentum in these areas would bolster the melt-up case,” Hougan said.