Latest news about Bitcoin and all cryptocurrencies. Your daily crypto news habit.
By Nigel Green, deVere Group CEO and Founder
Next year could, it can be reasonably expected, be the year Bitcoin hits new all-time highs.
Currently, the world’s largest cryptocurrency’s all-time high was around $64,863.10, reached on April 14, 2021.
Will this be surpassed in 2024? There are two legitimate reasons to believe that yes, it could be.
The first reason is the next Bitcoin halving, anticipated to occur in April.
The halving event is a key aspect of Bitcoin’s design, occurring approximately every four years or after the creation of 210,000 blocks.
During a halving, the reward that miners receive for validating transactions and adding them to the blockchain is halved, reducing the rate at which new Bitcoins are introduced into circulation.
Historically, Bitcoin halvings have been associated with significant price rallies. The logic behind this trend lies in the principles of supply and demand.
As the rate of new Bitcoin creation diminishes, the overall supply growth slows down, leading to a reduction in the available circulating supply. This scarcity tends to drive increased demand, as the fixed supply limit of 21 million Bitcoins creates a situation where each coin becomes more valuable.
Market sentiment and investor anticipation also play crucial roles in driving prices higher around halving events. The expectation of reduced supply tends to generate a speculative fervour, attracting new investors and triggering increased trading activity.
This heightened demand, coupled with the diminishing supply, typically results in a surge in Bitcoin prices. If historical patterns hold true, the 2024 Bitcoin halving may catalyse a renewed bullish trend in the cryptocurrency market.
The potential for new all-time highs hinges not only on the scarcity factor but also on the maturation and broader acceptance of Bitcoin within the financial landscape.
The second reason is the anticipated approval of Bitcoin spot ETFs. BlackRock, the $9trillion asset manager, alongside WisdomTree, Invesco Galaxy, Wise Origin, VanEck, Bitwise and Valkyrie Digital Assets, have published Bitcoin ETF applications waiting to be approved by the US Securities and Exchange Commission, the SEC. Â
I believe that Bitcoin ETFs are almost an imminent inevitability. And there won’t be just one company approved either, because this would imply that the regulator is a de facto ‘kingmaker’.
If I’m right and we get a wave of approvals of ETFs, I am confident that crypto prices will skyrocket for four main reasons.
First, a Bitcoin ETF allows investors to gain exposure to Bitcoin without directly owning or trading the cryptocurrency. Such increased accessibility for both can lead to a larger pool of potential investors entering the market, driving up demand for Bitcoin.
The second reason is the introduction of a Bitcoin ETF will undoubtedly attract institutional investors who have strict regulatory requirements and risk management policies.
Third, ETFs are traded on established stock exchanges, providing liquidity and ease of trading. This liquidity will attract more traders and increase market efficiency, reducing price volatility. As such, increased liquidity and market efficiency can positively impact the price of Bitcoin and other cryptocurrencies.
And fourth, a Bitcoin ETF will generate significant mainstream attention and media coverage which will drive up demand and prices in the crypto market.
Of course, only time will tell. But the chances that Bitcoin will run higher than the previous all-time high at some point in 2024 are looking pretty good.
Disclaimer: This article provides general information and is not personalised investment advice. Individuals should consult with a qualified financial advisor before making any investment decisions. The content does not consider individual circumstances, and past performance is not indicative of future results. Always conduct independent research.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.