Bitcoin’s Possible $125,000 Price Target and the Rise of Altcoins
CK Zheng, founder of crypto hedge fund ZX Squared Capital, recently shared his insights on the current state of the cryptocurrency market. According to Zheng, Bitcoin could potentially reach a price of $125,000 by the end of the year, but other cryptocurrencies are likely to outperform. In an interview with CoinDesk, Zheng explained that he believes there is a correlation between Bitcoin and altcoins, but that the dominance of Bitcoin in the market will decline.
Decline of Bitcoin Dominance
Zheng’s prediction is based on his observation that the Trump administration has taken a more favorable stance towards the crypto sector. The White House is contemplating the creation of a national cryptocurrency reserve, which would be a significant development for the industry. Additionally, the Securities and Exchange Commission (SEC) has been dropping its lawsuits against crypto companies and protocols such as Kraken and Uniswap.
This shift in policy and regulation is likely to trigger new ideas for innovation and shake up the crypto industry. According to Zheng, "New policies and regulations will come out and trigger a lot of new ideas for innovation and shake up the crypto industry." Although it may take some time for these changes to play out, Zheng believes that they will have a lasting impact on the market by 2025 and 2026.
Altcoins and Smart Contract Blockchains
Zheng identifies Ether (ETH) and Solana (SOL) as two cryptocurrencies that are likely to benefit from the new wave of innovation. He notes that projects combining artificial intelligence (AI) and crypto will be particularly attractive, especially if smart contract blockchains continue to increase their throughput.
In the case of Solana, Zheng believes that its ability to remain attractive will depend on its continued growth in throughput. For Ethereum, he suggests that it needs to take back the initiative by increasing its throughput as well. If these conditions are met, Ether and Solana may be among the top-performing cryptocurrencies in the coming years.
Bitcoin’s Behavior
Zheng also notes that Bitcoin is likely to continue behaving like a risk-on asset, rising and falling in tandem with other such assets. This behavior will be influenced by the Trump administration’s economic policies, which are still evolving. However, if the U.S. government does implement a national cryptocurrency reserve, it could have a significant impact on Bitcoin’s price.
According to Commerce Secretary Howard Lutnickt, "A bitcoin strategic reserve is something the President’s interested in. He spoke about it all during the campaign trail, and I think you’re going to see it executed on Friday." This development would likely lead to a positive response from investors, who may view Bitcoin as a more stable store of value.
Near-Term Outlook
In the near term, Zheng expects the market to remain choppy. However, he believes that this is a good opportunity for long-term investors to allocate to Bitcoin. With tariffs against Mexico, Canada, and China seemingly coming into effect, Zheng does not expect Bitcoin’s price to fall below $75,000.
Overall, Zheng’s predictions suggest that the crypto market will undergo significant changes in the coming years. While Bitcoin may reach a price of $125,000 by the end of the year, other cryptocurrencies are likely to outperform. As the industry continues to evolve, investors will need to stay informed and adapt their strategies accordingly.
Conclusion
CK Zheng’s insights on the crypto market provide valuable context for investors looking to navigate the complex and rapidly evolving landscape. While Bitcoin may continue to be a dominant force in the market, other cryptocurrencies are likely to benefit from the new wave of innovation triggered by changes in policy and regulation. As the industry continues to grow and mature, it is essential to stay informed and adapt to changing circumstances.
