2024 promises to be a year of continued expansion for Bitcoin, says Cory Klippsten, CEO of Swan.
As usual, the price of Bitcoin was a big story, and in 2023 it was good news. Bitcoin is once again the best-performing asset class, beating stocks, bonds, and gold by a wide margin. As of today, the price is up more than 150% since the beginning of the year.
ETFs (Exchange-Traded Funds):
These are investment vehicles that track a basket of assets, similar to mutual funds. In the context of crypto, a Bitcoin ETF would track the price of Bitcoin.
Potential Impact:
Approval of a Bitcoin ETF by the SEC (Securities and Exchange Commission) in the US could be a major boost for the market.
It would allow traditional investors easier access to crypto, potentially leading to increased investment and price hikes.
However, some experts are cautious, as past ETF launches haven’t always had a significant impact.
Halving:
This refers to a programmed event in certain cryptocurrencies, like Bitcoin, where the block reward for miners is cut in half.
Potential Impact:
The theory is that halving reduces the supply of new coins entering circulation, which could drive the price up due to scarcity.
The most recent Bitcoin halving happened in April 2024, so its direct impact might be fading by now.
However, some analysts believe its effects can be delayed and might still be influencing the market.
Upgrades:
Many blockchains undergo regular upgrades to improve scalability, security, or functionality.
Potential Impact:
Successful upgrades can boost confidence in a particular cryptocurrency, potentially leading to increased adoption and price appreciation.
Conversely, issues during upgrades can create uncertainty and negatively impact prices.
Overall:
These factors can all be intertwined. For instance, a successful upgrade on a major blockchain like Ethereum could pave the way for ETF approval, leading to a price surge.
It’s important to stay informed about developments in all these areas to make informed investment decisions in the ever-evolving crypto landscape.
What Will Happen to Bitcoin in the Next Decade?
When Bitcoin was introduced to the world in 2009, it was intended to revolutionize the way people could access and control their money. But that revolution has hardly come to pass. The cryptocurrency’s tumultuous first decade was marked by scandals, missteps, and wild price swings—its second has been no different.
Large-scale fraud, theft, regulatory battles, and more continue to make the headlines. It’s difficult to say what will happen over the next decade, but here are some thoughts about Bitcoin’s future.
KEY TAKEAWAYS
- Bitcoin, the cryptocurrency, is most likely to remain popular with speculators over the next decade.
- Bitcoin, the blockchain, will probably continue to be developed to address long-standing issues like scalability and security.
- Halvings are an important part of Bitcoin’s future because they have historically influenced price increases.
- There is no way to accurately predict what will happen to Bitcoin in the next 10 years.
This post is part of cdatacap@gmail.com “Crypto 2024” predictions package.
2023 marked a tremendous surge in institutional interest, highlighted by BlackRock’s application for an ETF in June. There are currently as many as 12 open applications, including those from Invesco, ARK, Fidelity, VanEck, and Franklin Templeton. Although the SEC refused GBTC’s application, a court ruled that the SEC’s reasoning for doing so was invalid. Even just a rumor of approval in October sent Bitcoin’s price skyrocketing.
https://youtu.be/CQYx13HsSU4?si=KcE_2SBlwMHyuNDk
The energy used to mine and secure Bitcoin also saw significant growth, with the mining hashrate up 100% from 240 exahash to 482 exahash year-to-date. The hashrate is the measure of how many calculations per second are required to add another block of transactions to Bitcoin’s ledger an average of once every ten minutes. Bitcoin continues to leap ahead as the most secure and reliable digital system in the world. Network uptime was 100% for the 14th straight year. 2023 also saw much more widespread recognition that Bitcoin’s relationship to energy and the environment is overwhelmingly positive, contributing to electrical grid stabilization and creating economic incentives to mitigate carbon emissions.
Looking forward to 2024, one thing that’s certain to happen is the next “halving,” when the new issuance of Bitcoin will be cut in half at block 840,000, which is expected to be mined in late April. Despite growing demand for Bitcoin, the supply added per block will nevertheless be reduced by 50%. This will be the fourth halving in Bitcoin’s history. Historically, a bull market has followed halvings. Whether causation or anomaly, it’s true until it’s not, and we plan Swan’s strategy incorporating a high probability of a bull market in 2024 and 2025.
In addition, it is almost certain that we will see the approval of one or more spot Bitcoin ETFs. This would open up floodgates of capital currently in traditional investment channels. The consensus is that this is most likely to happen in January.
Bitcoin’s technology trends in 2023 included the continued impact of the Taproot upgrade, enhancing transaction efficiency and privacy. The Lightning Network’s maturation underscored Bitcoin’s ability to scale by adding layers on top of the Bitcoin protocol to facilitate faster, more economical transactions. Lightning infrastructure has come a long way, with scores of lightning-enabled wallets, on-demand Lightning nodes, and facilitating an estimated 200,000 transactions per day. It will be interesting to watch what this more mature Lightning Network will do in the sustained high-fee environment of another bull market.
In 2024, amid global financial uncertainty, Bitcoin’s stability could attract attention from individuals, institutions, and governments seeking to reduce chaos. Bitcoin is reaching record values against weak currencies, gaining support from global politicians, and being used more by people and businesses worldwide. Bitcoin’s growth is natural, without central control, and driven by millions of people worldwide who recognize its benefits. Bitcoin safeguards global monetary integrity, and sound money is a fundamental human right.
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