Crypto venture fund Pantera Capital illustrated that bitcoin's price could surge to $148,000 after the halving event scheduled for next year.

Using a metric called the stock-to-flow ratio, Pantera said the upcoming halving could see the bitcoin price rise to $35,000 before the event and $148,000 after.

The stock-to-flow ratio of an asset is a measure of its existing supply relative to the new supply entering the market. A higher stock-to-flow ratio indicates a scarcity of an asset, which can potentially increase its price. The current price of bitcoin is around $26,500.

Bitcoin halving events have historically been associated with increased bitcoin prices due to its impact on the stock-to-flow ratio. A halving is a programmed event that occurs approximately every four years, reducing the number of new bitcoins entering circulation by half. The 2024 halving will reduce the per-block reward to 3.125 bitcoins from the current 6.25 bitcoins per block. Such significant reductions in the flow of new supply result in a higher stock-to-flow ratio, effectively increasing bitcoin's scarcity and potentially its price.

"The 2020 halving reduced the supply of new bitcoins by 43% relative to the previous halving. It had a 23% as big an impact on price," Pantera Capital said. "The next halving is expected to occur on April 20, 2024. Since most bitcoins are now in circulation, each halving will be almost exactly half as big a reduction in new supply. If history were to repeat itself, the next halving would see bitcoin rising to $35k before the halving and $148k after," it added.

Besides the bitcoin halving event being a positive catalyst for the next year, the recent XRP ruling and a bitcoin ETF application by BlackRock provide a "strong setup for the next bull market for digital assets," according to Pantera Capital.

"Our view is that we've seen enough — there's just so long markets can be down," the firm said. "We would then see a rally into early 2024 and then a strong rally after the actual halving."