A little known metric called energy value has been used to predict bitcoin prices over the next five years and the results are impressive. A tenfold rise from current price levels could be on the cards for BTC.
Bitcoin continued to correct over the weekend dropping to an intraday low of $9,650 during Sunday trading. The move has taken BTC down by 8% from its 2020 high which came late last week. Prices had currently recovered to $9,800 but further losses are expected as the pullback continues.
Bitcoin Energy Value Prediction
The longer term outlook appears extremely bright, especially if predictions based on this relatively unknown metric are considered. The oscillator takes into account the bitcoin price as a percentage of its energy value, working on the premise that raw Joules alone can be used to estimate a fair value for BTC.
Digital asset manager Charles Edwards has been delving deeper into this metric, observing some major similarities with previous bitcoin market patterns.
“Based on a conservative estimate of Bitcoin’s Energy Value, it is likely that $BTC will 10X within the next 5 years.”
My #Bitcoin Forecast
🚀Bitcoin $100K within 5 years
Based on a conservative estimate of Bitcoin’s Energy Value, it is likely that $BTC will 𝟭𝟬𝗫 within the next 5 years.
A thread forecasting Bitcoin’s long-term price using Energy Value.
— Charles Edwards (@caprioleio) February 16, 2020
The indicator has closely tracked bitcoin prices over the past decade using two varying inputs to calculate energy value: hash rate and mining hardware efficiency.
Bitcoin’s hash rate has grown exponentially over the past five years and assuming the relationship holds Edwards suggests that the growth rate will drop from around 135% per annum today to roughly 20% in 2025.