Bitwise Analysts Call $219,000 The Fair Value of Bitcoin

Bitcoin (BTC) traded relatively flat on Wednesday, with its price being rejected around the $107,000 mark, forming a double-top pattern.

This comes despite a significant surge in its value over the past month, as investor sentiment remained buoyed around Trump’s swearing-in. That said, despite Bitcoin’s pause, analysts remain optimistic about its long-term prospects.

In a Tuesday report, Bitwise analysts put forward a bold forecast, calling Bitcoin’s fair value at just over $200,000, citing the increasing risks of sovereign defaults globally.

According to analysts, these risks are rising due to record-high public debts, especially in countries like the UK and France, where fiscal concerns worry bondholders. They underscored that the US national debt has surpassed $36 trillion, an alarming 123% of its GDP, raising doubts about the government’s ability to meet its fiscal obligations.

“In theory, Bitcoin, with its current ‘fair price’ of around $219,000, could serve as ‘portfolio insurance’ against the default of a basket of major sovereign bonds,” the report read.

Notably, as per the analysts, despite the uncertainty surrounding traditional financial markets, Bitcoin’s limited supply and decentralized nature also make it a strong candidate for those seeking protection against inflation and currency devaluation. They further argued that Bitcoin’s ability to operate independently of state control remains one of its biggest draws, particularly as governments struggle with economic instability.

Furthermore, they predicted that corporate investments in Bitcoin would continue to grow, making it a central feature of the global investment landscape in the coming years. This forecast aligns with the growing interest in Bitcoin-based financial products, such as ETFs, which have seen strong inflows in recent months.

Meanwhile, another research group, 10x Research, also set an optimistic target for Bitcoin, predicting it could hit $122,000 by February before undergoing another period of consolidation. The firm highlighted a bullish pennant pattern, noting that the current breakout at $106,000 reinforces the likelihood of this scenario.

However, CryptoQuant analyst Darkforst highlighted a short-term bearish signal in the Bitcoin market, focusing on the Short-Term Holder (STH) Spent Output Profit Ratio (SOPR). Notably, this metric recently turned negative, indicating that short-term holders are now selling their Bitcoin at a loss, which could explain the ongoing price consolidation.

According to the pundit, this shift could lead to one of two possible outcomes. In the first scenario, most short-term holders might choose to hold their positions, avoiding the realization of losses, which could establish a strong support level. In the second scenario, a wave of capitulation could ensue, with holders selling off their Bitcoin, potentially driving the market into a deeper correction.

BTC was trading at $103,432 at press time, reflecting a 1.02% drop in the past 24 hours.