Some analysts believe that the coming year 2024 will be very positive for the price of Bitcoin and the cryptocurrency market in general.
Against the backdrop of a set of motivating factors and historical behaviors, what may push the price of Bitcoin (BTC) to reach historical levels at $160,000?
In a new report issued on Wednesday by CryptoQuant, a company specializing in analyzing blockchain network data, it indicated 3 main factors that will support the price of Bitcoin in the coming year.
We believe that the Bitcoin and cryptocurrency markets may witness a positive year in 2024 mainly due to the effects of several factors, including 1. Market evaluation cycle, 2. Network activity, 3. Bitcoin supply reduction, 4. Major economic trends, 5. Fund approval Bitcoin derivatives trading, and 6. Increased liquidity of stablecoins.
Analysts at CryptoQuant.
The value of Bitcoin on the network and its metrics indicate that Bitcoin is still moving within a bull market and could target $54,000 in the medium term and $160,000 as the maximum price for this cycle.
Analysts at CryptoQuant.
3 main factors
First is the expected huge demand for Bitcoin from several spot exchange-traded funds (ETFs) in the United States.
Secondly, the expected Bitcoin halving event in April will halve the volume of new supplies of BTC currencies.
Historically, Bitcoin has seen a rally after every halving event – which automatically reduces the supply of new coins on the open market.
Traders currently believe that this upcoming event, which is scheduled to occur in April 2024, has been priced into Bitcoin prices.
More than seven major traditional financial institutions, led by BlackRock, are in talks with the US Securities and Exchange Commission (SEC) regarding Bitcoin ETFs. Continued dialogue likely indicates progress in the talks.
I would say this may be one of the biggest developments on Wall Street in 30 years.
Michael Saylor, CEO of MicroStrategy, the world’s largest Bitcoin investor with a value of more than $8 billion, in an interview with CNBC on Tuesday.
Noting that the last similar product was the S&P 500 ETF, which allowed investors to have one-click access to this index that is widely followed by investors around the world.
Traders also expect the US Federal Reserve to cut interest rates in 2024 due to the continued decline in inflation rates.
Historically, low-interest rates encourage investors to make big bets on riskier assets such as technology stocks and cryptocurrencies.
Corrections before the price of Bitcoin rises
These factors combined may raise Bitcoin prices to at least $50,000 in the short term, according to the report.
However, CryptoQuant warned in its report that prices may decline in the short term due to profit-taking. Many investors have large unrealized gains.
There are some risks related to price correction. Short-term Bitcoin holders have high unrealized profit margins, which historically precede price corrections.
According to what some analysts say.
Bitcoin prices have risen by more than 180% year-to-date. Which could create a potential negative scenario before the start of the new year.
