2024 could be the year Bitcoin (BTC-USD) hits new all-time highs thanks to two key catalysts: potential spot exchange-traded fund approval and the halving event.
With just one week left until the earliest deadline for the U.S. Securities and Exchange Commission (SEC) to approve a spot Bitcoin (BTC-USD) ETF, investors appear to be jumping on the FOMO (fear of missing out) train.
To be sure, the most watched cryptocurrency (BTC-USD) broke through $45 early Tuesday for the first time in nearly two years, spurring a rally in crypto-related stocks. BTC is up about 160% in 2023 and is changing hands at $44.9K at the time of writing.
“With the current price now sitting above $40,000 and nearly 3 years having passed since the last bull run, Bitcoin is in a prime position to appreciate in value and I imagine many institutional investors will buy their stake in the Bitcoin network relatively quickly,” said cryptocurrency expert Brandon Zemp, citing the potential approval of a spot ETF in early January and the halving event in April.
Note that the last three halvings, which occur every four years, have resulted in record prices for Bitcoin (BTC-USD).
That’s not to say the coin is risk-free. One of BTC’s biggest, looming headwinds is an unfriendly regulatory environment, but that didn’t seem to bother the coin much last year.
Seeking Alpha analyst Jason Appel said in his Bitcoin Outlook: “While the crypto space continues to wade through an unfriendly regulatory landscape, with the SEC taking several ‘after-the-fact’ actions following the absence of Terra/LUNA, Celsius, Voyager, and of course FTX, BTC has remained undeterred and has risen strongly this year.
James Foord, head of the “Pragmatic Investor” investment group, is bullish on Bitcoin (BTC-USD), although he believes that investors may have already priced in the expected price appreciation from the upcoming halving event.
“With everyone anticipating a rally into the halving, the market may not behave as expected and the ultimate Bitcoin price target may be lower than expected,” he wrote in mid-December.
Foord listed another risk: “Because Bitcoin is so closely tied to liquidity, I don’t think it will be immune to a deflationary recession, which has become increasingly likely over the past few months and could hit in 2024.
