The price of Bitcoin (CRYPTO: BTC) is determined by supply and demand. Its source code limits supply to 21 million coins, and 19.6 million of that total are already in circulation, meaning new Bitcoin supply has slowed to a trickle. But Bitcoin demand has risen sharply over the past year -- so much so that its price has soared 180% to $62,0000 (as of March 5).

Some of that demand can be attributed to a broad rotation into risk assets. Investors have become more comfortable with growth stocks and cryptocurrencies as recession fears have diminished. But the recent approval of spot Bitcoin exchange-traded funds (ETFs) has also boosted demand. In fact, through the first month of trading, spot Bitcoin ETFs issued by and Fidelity saw greater inflows than any other ETFs in history, according to Bloomberg Intelligence.

Of course, the big question is, where does Bitcoin go from here? Given that its price trajectory is a product of supply and demand, Fidelity analysts have proposed supply-based and demand-based valuation models that attempt to answer that question. One of those models values a single Bitcoin at $1.2 million by 2030, implying about 1,970% upside from its current price.

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Source Fool.com