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One of the most difficult tasks in the industry is price targets. As we enter the 2025 forecast season, this becomes extremely clear as strategists lay out their arguments based on underlying economic growth rates, business projections, opportunities and experiences.
But what if you had almost none of these data points? That’s what the crypto analysts need to do. Without being able to look at the fundamentals and the management team’s vision, there’s not much left beyond sentiment – and the challenge of being creative in measuring it.
As our Chart of the Week shows, bitcoin has been climbing higher since the election as demand has increased. It has reached the $99,000 mark and is approaching six figures for the first time, thanks to the promise of an executive branch full of crypto allies – if not believers – who will unlock the next wave of demand.
“Anecdotally, we are seeing renewed interest in crypto from casual observers,” Sean Farrell, head of Fundstrat’s digital asset strategy, wrote in a note to clients this week, noting that “friends and family” are asking questions about crypto again.
Once again, we’re at the point in the cycle where the bitcoin conversation is moving from more niche financial media to pretty much everyone’s. And like the peaks of 2017 and 2021, it’s just in time to be a major topic around the Thanksgiving table. Comparisons that naturally raise the big question of whether this is the latest top.
But according to Farrell, “if we look beyond social signals and toward more quantifiable market indicators, the current landscape does not exhibit the frothy March rally or the cyclical peak of late 2021.”
One of those ‘quantifiable’ market indicators of sentiment and froth is the price difference between bitcoin in South Korea and bitcoin on Coinbase, for example – the other part of our Chart of the Week. The crypto industry calls this the “Kimchi Premium” or the “Korea Premium Index,” and it stems from the country’s quirky capital control laws that prevent arbitrage. If you buy in South Korea, you have to sell it there. (This phenomenon inspired Sam Bankman-Fried’s arbitrage game.)
“When the speculative fervor kicks in, we will eventually see a premium on the price of BTC on Korean exchanges versus other crypto exchanges,” Farrell wrote. “Currently, the premium is around 0%, indicating a lack of exuberance among Korean traders.”
