Cryptocurrency price is rising, barriers are decreasing: What you need to know when buying Bitcoin

Bitcoin price has been in an upward trend since mid-October. Last week it surpassed $35,000 for the first time since May 2022. The price is expected to rise to $150,000 by mid-2025, according to analysts at US asset manager Bernstein. However, by no means all experts share this assessment. “If you were to believe most price prophets, the Bitcoin price would have to be between zero and one million francs at the same time,” says Fabian Schär (34), professor of fintech and blockchain at the University of Basel. “The current market price is created by the price expectations of all market participants and is therefore the most reliable forecast.”

One reason for the Bernstein prediction is the so-called halving. Every four years, the reward for Bitcoin miners is halved. Because the upper limit of crypto money is 21 million Bitcoins. Therefore, the rate at which new Bitcoins are created is gradually slowing down and the supply is gradually decreasing. The next halving could occur as early as March 2024.

The halving comes with the predictable approval of spot ETFs (Exchange Traded Funds) for Bitcoin by the US Securities and Exchange Commission (SEC). Such crypto funds can be bought and sold on the stock exchange, similar to stocks. These are directly linked to the exchange rate and allow investors to invest without having to own Bitcoin.

Initial approval could occur within the next few months. Many crypto investors expect the halving to occur as demand increases due to new Bitcoin ETFs. They expect a big price increase.

So are ETFs a game changer? Crypto expert Rino Borini (50) is convinced: “Cryptocurrencies have been created.” The fact that BlackRock, of all companies, has filed for an ETF shows that opinion in the US financial sector has changed. The world’s largest asset manager has been struggling with Bitcoin for a long time. If the SEC also changes course, that would be a strong sign.

Borini believes that developments in the US have made Bitcoin reliable in Switzerland as well. In October, Zuger Kantonalbank became the first state bank to launch an offer for private individuals. St. Wales and Luzerner Kantonalbank and Postfinance are also following the same path. “You finally understand the needs of Swiss customers,” says Borini.

Is it the ideal time to invest in Bitcoin? “You never know,” says Borini. The route may quickly go in a different direction again. Instead of waiting for the right moment, Borini recommends a crypto savings plan. “For example, with an investment of 100 francs a month.” After a while, this results in an averaging cost effect that eliminates price fluctuations.

Schär also warns against hasty decisions. The risk is still high. “Investments should only be made if the total loss is easily bearable.”

The entry of state banks at least makes investment much easier. Because they do business through e-banking.

Even outside cantonal banks, Swiss companies are open to crypto. Snack machine maker Selecta, for example, announced this week that it will soon upgrade its snack machines with a payment method for cryptocurrencies. There are also many hotels, restaurants and shops in Switzerland that already accept cryptocurrencies.

The city of Zug, which is considered the crypto capital of Switzerland, has also successfully established Bitcoin in its administration: Since 2021, Zug residents have been able to pay their taxes and administrative fees with cryptocurrencies. In 2022 the city had already received two million francs. This amount is expected to at least double this year.