𝟯 𝘁𝗵𝗶𝗻𝗴𝘀 𝘆𝗼𝘂 𝗺𝘂𝘀𝘁 𝗸𝗻𝗼𝘄 𝗮𝗯𝗼𝘂𝘁 𝗯𝗶𝘁𝗰𝗼𝗶𝗻 𝗶𝗻 𝟮𝟬𝟮𝟰

1. From a demand perspective, the potential approval of a spot bitcoin ETF by the SEC is poised to facilitate the entry of numerous new investors looking to incorporate bitcoin exposure directly into their traditional investment portfolios. This approval eliminates the need for navigating the complexities of crypto exchanges, allowing investors to utilize a familiar investment vehicle – an ETF. Consequently, this development is anticipated to enhance liquidity and stability in bitcoin's price. Moreover, the SEC's green light signifies a significant milestone in establishing bitcoin's legitimacy within mainstream financial institutions.

2. Turning to the supply side, the scarcity of bitcoin undergoes an increment roughly every four years through halving events. During these events, the reward for Bitcoin miners is halved, resulting in a 50% reduction in the rate of new bitcoin issuance. With the upcoming halving expected in April 2024, the block reward is set to decrease from the current 6.25 BTC to 3.125 BTC.

3. Since the last halving on May 11, 2020, which reduced the block reward from 12.5 BTC to 6.25 BTC, bitcoin has demonstrated a compound annual growth rate of 52%.

Taken together, these factors present a compelling investment proposition for bitcoin and indicate a potential entry point. The implied value is approximately $62,000 per bitcoin in April 2024, reflecting a roughly 34% increase relative to the current price.

Source: Synthetic

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