Bitcoin (BTC 1.97%) had a tremendous year in 2023, soaring 154%. This gain matches what some "Magnificent Seven" stocks were able to do.

However, Bitcoin still remains 35% below its peak price. So there is a lot of room to go to regain a new high.

As of early January, the price sat at roughly $45,000. But bullish investors have their sights set on a major milestone: the $100,000 mark. Can the world's top cryptocurrency reach this six-figure sum?

Multiple catalysts to benefit from

It's easy to be optimistic that Bitcoin's price will rise 122%, even within the next 12 to 24 months. There are numerous catalysts the digital asset can benefit from.

About every four years, Bitcoin's blockchain undergoes what is arguably the most bullish event for this cryptocurrency. The so-called "halving," set to take place in April, is when the reward that miners receive for processing transactions gets cut in half, thus reducing the new supply of Bitcoin hitting the market. When you add this to steadily rising demand over time, the recipe for strong price gains is there.

Historically, the months before and after a halving have seen Bitcoin post huge growth. Based on the price performance in 2023, investor enthusiasm is already there.

Another catalyst would be the approval of a spot Bitcoin exchange-traded fund (ETF). There are a number of asset management firms vying to introduce this product to the market. Some experts believe that the Securities and Exchange Commission (SEC) could approve these ETFs this month.

Some investors, whether individuals or institutions, might still be skeptical about buying Bitcoin directly. They could be worried about how to custody it, or about the uncertain regulatory outlook.

However, if spot Bitcoin ETFs become a reality, I think it would make this crypto a legitimate financial asset with the government's stamp of approval. The result could be that huge sums of capital flow into Bitcoin, demand that can support a higher price.

While both the halving and the approval of a spot ETF capture the minds of investors, there's an under-the-radar catalyst that could propel Bitcoin.

And this is the reversal of the Fed's tighter monetary stance. Inflation has shown signs of cooling over the past several months. And with it getting more under control, the central bank could institute rate cuts throughout the course of 2024. This would be a welcome sign, especially for risky assets.

If the Fed adopts looser monetary policy, economic activity could begin to pick up. And more capital can flow toward various asset classes, particularly those further out on the risk spectrum. Plus, Bitcoin could benefit from its continuing media coverage.

Maintain a long-term focus

I think there's a very high probability Bitcoin could reach the $100,000 mark within the next three years. I also wouldn't be shocked if the crypto hit that figure by the end of 2024. There are just so many positive developments working in its favor right now.

Despite the reasons to be optimistic, investors must always keep their sights set on the long term. Anything can happen in a given month, quarter, or year. And the last thing you want to do is panic at the absolute worst time and sell your Bitcoin holdings.

Instead, aim to grow your knowledge about Bitcoin, gaining greater conviction in the process. And don't be discouraged if your portfolio doesn't immediately register monster gains. This is an asset that should be held with a time horizon of five to 10 years, at least.