Saxo Bank: Bitcoin price could reach $100,000 this year

Bitcoin prices could hit $100,000 by mid-2018, an analyst who accurately predicted a rise in bitcoin prices early last year told CNBC on Tuesday.

The analyst, Kay Van-Petersen of Denmark’s Saxo Bank, added that other cryptocurrencies could also outperform.

Van Petersen predicted in December 2016 that the price of bitcoin would reach $2,000 in 2017, when it was less than $900, according to data from CoinDesk, a website that tracks digital currency prices across multiple exchanges. In May last year, the price of bitcoin rose above $2,000.

On Tuesday, Van Petersen predicted that the price of bitcoin could reach between $50,000 and $100,000 in 2018.

"First, it can be said that the price of Bitcoin has experienced a normal correction. Its price has fallen by 50% at one point, which is healthy. However, we have not yet seen the full impact of the futures contract," said Van Petersen.

Both the Chicago Mercantile Exchange (CME) and the Chicago Board Options Exchange (Cboe) launched bitcoin futures contracts last year, a move seen as a way to get more institutional investors involved in the cryptocurrency market and make it more legitimate. But at the beginning of the launch of bitcoin futures, market trading was relatively light. Van-Petersen believes that more institutional investors will enter the bitcoin futures market over time, but it won't happen quickly.

According to CoinDesk data, the price of Bitcoin has hit a high of $13,601.43 in trading so far on Tuesday, which means that its price needs to rise by more than 635% to reach the $100,000 predicted by Van Petersen. Previously, Van Petersen predicted that it would take a decade for Bitcoin to reach $100,000.

Bitcoin prices have been moving sideways since the beginning of the year, but Van-Petersen believes that Bitcoin prices tend to trade around a certain level for a while before "revaluing."

“It wouldn’t surprise me if we saw something like that. It’s kind of like building a base and then it’s going to revalue and move a little higher,” Van Petersen said.

But bitcoin and other cryptocurrencies such as ethereum and ripple were hit by heavy selling in Tuesday's trading.

Van Petersen still believes that Ethereum is likely to outperform Bitcoin this year.

“Ethereum came after Bitcoin and has a more unified leader than Bitcoin,” she said. “Ethereum transactions dwarf those of other cryptocurrencies.”

Unlike Bitcoin, Ethereum has a core group of developers who control how the technology behind it evolves, which some experts say will give it longevity and certainty in how it grows.

Van Petersen, who owns a number of different cryptocurrencies, is a well-known bull in the space and is one of several industry insiders who have also predicted a sharp rise in bitcoin prices.

Julian Hosp, co-founder of TenX, a company that wants to make it easier for people to spend virtual currencies, told CNBC in December that he expects bitcoin prices to hit $60,000 by mid-2018, but that they may crash before that. Dave Chapman, managing director of cryptocurrency trading firm Octagon Strategy, also said bitcoin prices could hit $100,000 in 2018.

However, many big names have poured cold water on cryptocurrencies. Legendary investor and stock god Warren Buffett told CNBC that cryptocurrencies will eventually have a "bad ending." JPMorgan Chase (NYSE:JPM) CEO Jamie Dimon once called Bitcoin a "fraud."

Meanwhile, regulators in some major cryptocurrency markets are cracking down on trading. South Korean authorities, for example, are discussing a possible ban on certain exchanges.