Investors are looking at $12,000 to $30,000

After a tumultuous 2022, crypto investors are trying to figure out when the next bitcoin bull run might be.

Last week, at a crypto conference in St. Moritz, Switzerland, CNBC spoke with industry insiders who painted a picture of 2023 as the year of caution. Bitcoin is expected to trade within a range, be sensitive to the macroeconomic situation such as interest rate hikes and continue to be volatile. Another bull run is unlikely in 2023.

However, experts look ahead to next year and beyond with optimism.

By 2022, the entire cryptocurrency market lost around $1.4 trillion in value with the industry facing liquidity problems and bankruptcies topped by the collapse of the exchange FTX. Contagion spread across the industry.

While bitcoin has had a small bump at the start of the year, in line with risk assets such as stocks, experts say bitcoin is unlikely to test its all-time high of just under $69,000, but it may have bottomed.

“I think there’s a little bit more downside, but I don’t think it’s going to be much,” Bill Tai, a venture capitalist and crypto veteran told CNBC last week.

“There is a chance for that [bitcoin] has bottomed out here,” adding that it could drop as low as $12,000 before bouncing back up.

Meltem Demirors, head of strategy at CoinShares, said bitcoin is likely to be range-bound trading at the low end between $15,000 and $20,000 and at the high end between $25,000 to $30,000.

She said that much of the “forced selling” that occurred in 2022 as a result of collapses in the market is now over, but there is not much new money coming into bitcoin.

“I don’t think there’s much foreclosure left, which is optimistic,” Demirors told CNBC on Friday. “But again, I think the upside is pretty limited, because we’re also not seeing a lot of new convictions coming in.”

Investors also keep an eye on the macroeconomic situation. Bitcoin has been shown to be closely correlated with risky assets such as stocks, and especially the tech-heavy Nasdaq. These assets are affected by changes in interest rates from the Federal Reserve and other macroeconomic features. Last year, the Fed embarked on an aggressive rate hike path to try to tame inflation, which hurt risk assets along with bitcoin.

Industry insiders said a change in the macro situation could help bitcoin.

“There may be catalysts that we’re not aware of, again, the macro situation and the political environment is quite uncertain, inflation continues to run quite hot, I think is a new thing. We haven’t seen that, you know, in 30, 40 year,” Demirors said.

“So who knows, as people look to make allocations into the new year where crypto will fit into that portfolio?”

In CNBC’s interviews, several industry participants talked about historical bitcoin cycles, which occur roughly every four years. Usually bitcoin will reach an all time high and then have a massive correction. It will be a bad year and then a year of mild recovery.

Then “halving” will happen. This is when miners, who run specialized machines to effectively validate transactions on the bitcoin networks, see their mining rewards cut in half. Miners receive bitcoin as a reward for validating transactions. The halving, which occurs every four years, effectively slows the supply of bitcoin to the market. There will only ever be 21 million bitcoins in circulation.

Halving usually precedes a bull run. The next halving event will take place in 2024.

Anthony Scaramucci, founder of SkyBridge Capital, called 2023 a “recovery year” for bitcoin and predicted it could trade from $50,000 to $100,000 in two to three years.

“You take risks, but you also believe [bitcoin] adoption. So if we get the adoption right, and I think we will, this could easily become a fifty to a hundred thousand dollar asset in the next two to three years,” Scaramucci said.

Tai, meanwhile, said the beginning of a bull run is “probably a year away,” and said the aftermath of the FTX collapse could continue to be felt for another six to nine months.

Jean-Baptiste Graftieaux, global CEO of cryptocurrency exchange Bitstamp, told CNBC last week that the next bull run could come in the next two years, citing growing interest from institutional investors.

However, Demirors warned that the events during 2022 “have caused enormous reputational damage to the industry and the asset class,” adding that “it will take some time for this confidence to return.”