The cryptocurrency market is looking forward to the return of the bull cycle at the beginning of 2024. As of 2023, Bitcoin has appreciated by 155% annually.
Perhaps the biggest anticipation for next year is the imminent launch of a spot Bitcoin ETF in the U.S. financial market. This will allow investors to gain exposure to Bitcoin without the need for custody of assets.
In the Bitcoin ecosystem, people are focusing on the upcoming halving event around April 2024. The halving is an event that happens every four years and cuts miner rewards in half, thus controlling Bitcoin inflation and generally boosting the value of the asset.
On the domestic front, Brazil’s central bank will organize two public consultations to develop regulation for Brazil’s cryptocurrency industry.
Bitcoin Portal spoke to several experts and industry members about their expectations for 2024 and what events they expect the market to be affected by next year.
Central Bank to Regulate National Cryptocurrency Market
Fabrício Tota, MB’s new business director, noted that the Bitcoin ETF and the growth of the Solana ecosystem will have a huge impact in 2024, but he mainly emphasized the changes that Brazilian investors can expect at home.
“It’s worth highlighting the change in the regulatory environment in Brazil,” he said. “It’s a very positive thing for the market, but it should send a significant shockwave through the local industry because I think, especially given the public consultation that the central bank published last week, we can already see that the bar is going to be raised.”
Tota said this will be a defining moment for entrepreneurs operating in Brazil, who will have to ask themselves: “Do I raise the bar together, or do I go to another industry because I’m not interested in this level of sophistication?”
Following the approval of Law No. 14,478/2022, the BC was chosen as the regulator of the cryptocurrency market and must lay down the rules that virtual asset service providers must follow to operate properly in the country.
Antônio Marcos Guimarães, a consultant at the Central Bank’s Financial System Supervision Department, said in a live broadcast in early December that between April and May next year, the Central Bank will hold a second public consultation and make the minutes available: these will include another specific draft of the modalities for operating some VASPs and the cryptocurrency market, as well as the process for obtaining authorizations and licenses.
At the time, the BC advisor said that regulating cryptocurrency brokers located offshore but providing services to Brazilians was one of the entity’s main concerns. To this end, he said the BC was studying policies already implemented in other countries such as the United States and the United Kingdom.
Spot Bitcoin ETFs Will Finally Arrive in the U.S.
César Felix, Customer Experience Manager at NovaDAX, remembers that at the beginning of this year, a deadline was due from the SEC regarding multiple requests for a Bitcoin spot ETF.
He assessed: "To give you an idea, Wall Street is already anticipating the approval of the ETF, estimating that the product has the potential to raise up to $100 billion, according to Bloomberg. All of this will help increase investor interest in the market, leading to growth in the industry as institutional capital enters and liquidity increases."
Bitso CEO Thales Freitas noted that major companies such as BlackRock and Fidelity are expected to receive authorization to launch Bitcoin ETFs as early as January. "This could fundamentally change the cryptocurrency landscape, making it more integrated into investors' and companies' portfolios. This has been a major catalyst for the rise in Bitcoin prices this year."
Halving and reduced BTC issuance
Foxbit analyst Beto Fernandes sees the Bitcoin halving as a major checkpoint in the market cycle. "Historically, this event usually marks the beginning of a bull run. Therefore, with the halving coming in April, the Bitcoin accumulation movement is not only a trend, but is already happening. He said that the mechanism of reducing the issuance of Bitcoin is expected to create a shock between supply and demand, with the possibility of refreshing historical highs in the medium term.
Wander Guedes, head of Transfero Prime Table, recalled that the last halving was accompanied by a significant appreciation of Bitcoin a year after the event, with increases of 284% in 2016 and 559% in 2020.
NFT, DeFi, and crypto games will once again become the focus
Sebástian Serrano, CEO of Ripio, noted that a new bull cycle could bring new trends to industries, markets, and communities, such as more integration with artificial intelligence, creative resources like Ordinals, and unprecedented forms of asset tokenization. But he remembered that old trends could return in an important way in 2024. "DeFi protocols, NFTs, and the entire Web3 gaming space have been important in previous bull cycles and are areas to watch because they have maintained large growth developer and user communities even during the pandemic-induced recession," said Serrano.
Tokenization will take over the market
Rodrigo Caggiano, product director at Mobiup, pointed to two factors that he believes will drive the market: the tokenization of financial instruments and the tokenization of physical assets (RWA).
According to reports from JPMorgan Chase, Binance, and Boston Consulting Group, among others, asset tokenization is expected to reach $16 trillion, or about 10% of global GDP, by 2030, with physical assets leading the transformation. Tokenization is not limited to fine art; it encompasses a wide range of assets, from rare beverages to music royalties, making it easier to diversify portfolios," he said.
Volcano Bonds and Bitcoin Cities
Bipa CEO Luiz Parreira mentioned that El Salvador’s Bitcoin bonds, or “Volcano Bonds,” are expected to shake up the market when they are launched in the first quarter of 2024. The local government hopes to use this source to repay sovereign debt and finance Bitcoin City.
“This marks the beginning of a bitcoin-based capital market in El Salvador, with the 10-year bond offering holders a 6.5% annual yield,” Parreira said.
Focus: America's wars and elections
Patex CEO Ricardo Da Ros said that geopolitical events could affect the crypto market next year, such as the possible expansion of wars that are already underway and other wars that may eventually emerge. “I recommend monitoring these wars because they can affect the entire financial sector,” he advised.
The executive also noted that the political situation in the world's largest economy is worth paying attention to. "Another point to consider is the US election. The economic situation in the United States affects the global economy, and if the economic situation deteriorates, it will undoubtedly affect the global cryptocurrency market and affect the value of currencies." #巴西 #加密货币
