Bitcoin could be on track to hit six figures by 2024, analysts say, thanks to a confluence of factors that can increase demand and restrict supply. The leading cryptocurrency recently surpassed $40,000 for the first time since its crash in 2022, and many investors anticipate much more upside ahead.
Key points
- Bitcoin could reach $160,000 in 2024 due to upcoming halving event, spot ETF hype, and potential Fed rate cuts
- Historically, Bitcoin has rallied after its halving events, which reduce the supply of new coins.
- More than seven major financial firms like BlackRock seek SEC approval for spot bitcoin ETF
- Analysts predict bitcoin could reach $1 million shortly after spot ETF approved due to massive new demand
- Upcoming Bitcoin Halving in 2024 Expected to Create Supply Shock and Drive Prices Higher
A major factor expected to drive bitcoin prices higher is the upcoming halving event in April 2024. Bitcoin code is written to reduce the reward for mining new blocks by half every four years or so. With fewer new coins entering circulation, greater scarcity often leads to higher valuations. Bitcoin has rallied strongly in the 12 to 18 months following its previous halvings.
Additionally, more than 7 major financial institutions like BlackRock have bitcoin spot ETF applications in the works. SEC approval could unleash a torrent of new institutional demand almost overnight. "You're hitting a very limited supply of bitcoins on exchanges and availability to buy with a flood of money," said Jan3 CEO Samson Mow. The influx could be enough to push bitcoin to $1 million โwithin days or weeks,โ he added.
Former Coinbase CTO Balaji Srinivasan also predicted seven-figure bitcoin prices after the long-awaited ETF approvals. ETFs would finally give institutional investors an easy avenue to gain exposure to bitcoin. Retail traders would also benefit from the additional liquidity that ETFs would bring.
The stars also seem aligned for a considerably larger increase: The Federal Reserve is projected to begin cutting rates again by 2024. Lower rates tend to benefit riskier assets like bitcoin. Furthermore, Bitcoin and the stock market have been strongly correlated recently. Any gains in stocks could push bitcoin higher.
The confluence of spot ETF approvals, the upcoming halving, potential Fed rate cuts, and growing mainstream adoption have analysts extremely optimistic about bitcoin's trajectory over the next year. Six-figure predictions may have once seemed overly optimistic, but increasing scarcity and demand could make $100,000+ bitcoin a reality sooner than many expect.
