The year 2023 has ended and a new year has arrived in the world of cryptocurrencies. It is time to prepare for the new year.
The year 2023 has surprised some since many expected cryptocurrencies to collapse and disappear completely.
But unexpectedly, cryptocurrencies, especially Bitcoin, Ethereum, and Solana, remained upward throughout the year.
But what awaits the cryptocurrency market in 2024? Let’s find out!
What awaits the cryptocurrency market in 2024?
Several things must be discussed to understand better what awaits the cryptocurrency market in 2024.
If we look at the current situation, several important points must be discussed:
- Bitcoin investment funds.
- Bitcoin halving.
- The state of the global economy and the US Federal Reserve.
- American Elections.
These four factors will strongly influence the movements of the cryptocurrency market in 2024, and therefore you must follow them.
1. Bitcoin investment funds (Bitcoin ETFs)
The biggest and most anticipated event of the year in crypto is the Bitcoin ETF.
These funds are expected to be responded to by the Securities and Exchange Commission (SEC) no later than the 10th of 2024.
This means that at the beginning of the year, we will know whether these applications will be accepted or not.
BlackRock, the American investment giant, introduced a Bitcoin investment fund, and then the American economic giants quickly followed suit as well.
This resulted in a strong increase in the price of Bitcoin from the third quarter until now.
If these funds are accepted, this event may be the last obstacle to a crazy increase in the market.
In addition to this, BlackRock has also applied for an Ethereum investment fund and the acceptance of a Bitcoin fund paves the way for the acceptance of an Ethereum fund as well, which is expected to respond to it in May 2024.
This means that all cryptocurrencies in the market are likely to increase.
But of course, there is also a possibility that these funds will be rejected, and we will know within a few weeks.
But this event is one of the most important events that must be monitored to know its outcome.
Undoubtedly, the movement of crypto throughout the year, whether rising or falling, will be affected by this event.
2. Bitcoin halving and the cryptocurrency market in 2024
The second event that everyone is waiting for is the next Bitcoin halving, which is expected to happen in April 2024.
We are almost 100 days away from this event. So we got very close to it.
Bitcoin halvings occur every four years and their purpose is to reduce the prizes won by Bitcoin miners. This is to make the cryptocurrency more scarce.
Since the emergence of Bitcoin until now, the price has risen strongly after each halving, and this is due to the increased demand for the currency and the scarcity of inventory on the market.
But will this time be different? Some analysts believe that the halving this time will not affect anything.
This may be true, as we do not have enough data to predict since Bitcoin has only been in operation for about 14 years.
This means that the price may increase but it is not certain that this will happen.
But in all cases, it is necessary to monitor the event and monitor the price of Bitcoin about this event and what could happen. Bitcoin may break its highest peak around this event.
3. Global situation, inflation, and the Federal Reserve
The third event to monitor is the state of the global economy.
The world suffered from violent inflation in 2022, and in 2023, central banks raised interest rates to fight and curb inflation.
In the United States, inflation fell from 9% to approximately 3%. But is this enough for the Fed?
Currently, the interest rate is approximately 5.25%, and it is not expected that the Federal Reserve will raise the interest rate more than this.
But the Fed may raise rates again if inflation increases further.
But expectations so far indicate that the Fed plans to cut rates about three times in 2024.
If this happens, we can expect a recovery in financial markets due to investors’ increased risk appetite.
Fears of financial recession
Some analysts expect a recession to hit the United States in 2024.
This is due to the aggressive rate hikes over the past two years and also because inflation has so far remained stubborn and not falling enough.
Therefore, based on this, some believe that the American economy will suffer greatly in the coming period and may suffer a recession soon, as happened in Germany, for example.
But this is uncertain as the Fed may have to cut rates aggressively to combat this.
The rule has always been that the Fed prefers inflation over deflation.
Therefore, if there is a violent reduction in interest rates to fight the recession, crypto will be the first to benefit from this, since high-risk assets such as crypto benefit greatly from low interest.
4. American Elections
The last important event in 2024 is the US elections.
This is because the current government in America is hostile to crypto.
The Biden government does not support crypto and sees it as a threat facing the dollar and affecting its control over the world.
Therefore, the government seeks in every possible way to curb the spread of crypto.
But on the other hand, we see that the Republican Party sees crypto as a great opportunity for the United States to gain more control over the global economy.
Thus, they support the existence of crypto-friendly laws and regulations in the United States.
The conflict between the two will appear strongly in the upcoming elections, in which Biden is expected to compete with Trump.
The cryptocurrency team is in this case that Donald Trump will win the election since Trump is a supporter of cryptocurrencies and has launched his collection of NFTs in 2023 as well.
But this event will happen at the end of 2024 and therefore will not affect crypto in 2024 but more at the end of the year and the beginning of 2025.
But it is also important to follow the news of the presidential elections in America from now on to avoid shocks.
