Analysts have significantly raised their price target for Bitcoin (BTC), citing the surge in technological innovation as a key catalyst.
As Bitcoin sets new standards, the financial ecosystem is closely watching the transformative impact of Layer 2 (L2) solutions on the cryptocurrency’s scalability, security, and decentralization.
Technological progress will increase the price of Bitcoin
Muneeb Ali, CEO of Trust Machines, has played a key role in promoting Bitcoin’s L2 technology. He believes that Bitcoin’s scalability challenges are on the verge of a revolutionary breakthrough with L2 solutions.
This development aims to increase Bitcoin’s transaction efficiency. It also represents a strategic move to ensure that Bitcoin remains at the forefront of the competitive blockchain industry.
“L2s are moving fast. Bitcoin won’t change much. L2 are innovative and open to rapid change. After a while, it becomes part of their culture. Currently, I see that the ‘XYZ ecosystem’ has one major update every six months: this would be very healthy for Bitcoin,” Ali said.
Moreover, the introduction of the Ordinals protocol, the emergence of BRC-20 tokens and the advancement of smart contracts via BitVM have significantly contributed to the revitalization of the free Bitcoin economy. This shift from a store of value to a viable ecosystem reflects wider acceptance and use in everyday transactions.
Elastos’ announcement of BTC Oracle also marks another milestone in Bitcoin’s technological evolution. This initiative aims to improve cross-chain functionality by enabling Bitcoin to be used across different blockchains. BTC Oracle and BeL2 expand Bitcoin’s utility in decentralized finance (DeFi) and beyond, with an emphasis on decentralization and privacy.
“By enabling any EVM-compatible blockchain to use Bitcoin-denominated smart contracts, the industry can unlock the incredible innovation and economic potential for the cryptocurrency ecosystem by staking ELA and receiving Bitcoin rewards” – Jonathan Hargreaves, global director of business development and ESG at Elastos, added .
The synergies between these technological advances and the market response have been overwhelmingly positive. In fact, analysts at Bernstein raised their year-end price target for Bitcoin to $90,000. This decision resulted from the emergence of a new wave of bulls, a solid inflow of Bitcoin ETFs and the aggressive expansion of miners.
Indeed, this revised forecast reflects optimism stemming from the technological leap in Bitcoin’s infrastructure and signals confidence in Bitcoin’s enduring value and utility.
“With a new Bitcoin bull cycle, strong ETF inflows, aggressive mining capacity growth and all-time high dollar mining yields, we continue to find Bitcoin miners compelling purchases for equity investors seeking exposure to the crypto cycle,” the analysts wrote from Bernstein.
Read more: Bitcoin price forecast for 2024 / 2025 / 2030
As developers make significant strides in improving Bitcoin technology, the consequences for its price become increasingly significant. These collaborative efforts pave the way for a future where Bitcoin will thrive as a digital currency and a pillar of digital finance.
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