- The crypto outlook for 2024 seems bullish with certain driving factors.
- US inflation dips and stable rates could signal a crypto price upswing.
As 2023 draws to a close, the crypto landscape stands as a testament to unprecedented highs and regulatory battles, with bears holding sway for extended periods. Yet, the resilience of market bulls has been constant, fiercely contending despite their struggle to maintain prolonged momentum. This fleeting strength prompts contemplation among the community about what the forthcoming year might hold for bullish movements.
However, there are several factors that contribute to the hopeful crypto outlook for 2024 embraced by analysts and the broader crypto market alike. They are mentioned below.
Bitcoin ETFs
While the volatility of the crypto market precludes precise predictions, analysts are eyeing 2024 with optimism, citing several catalysts propelling a potential bull year. Foremost among these are the Bitcoin ETFs. Even minor updates in this sphere have yielded substantial surges, propelling leading digital assets to monumental highs in Q4. Bitcoin soared to an 18-month pinnacle on November 9th, while Ethereum shattered its long-awaited resistance at $2000, fueled by ETF speculation.
Richard Teng, CEO of Binance, lent his perspective to this discussion, foreseeing a potential spot BTC ETF launch in the United States alongside the forthcoming Bitcoin halving, both poised to ignite a bull run in 2024.
Teng underscored other pivotal elements, notably the embrace of a “crypto and blockchain agenda” by financial giants like BlackRock and Fidelity. Their entry into the crypto sphere via innovative investment products like ETFs is anticipated to lure a new investor cohort. It fosters wider adoption and heightened liquidity.
Bitcoin Halving
A pivotal event on the horizon is the looming Bitcoin halving scheduled for April 2024. It is a quadrennial occurrence that effectively halves the cryptocurrency’s supply rate. This event reduced mining rewards from 6.25 BTC to 3.125 BTC per block. It anticipates a significant drop in new coin issuance. If historical trends persist, Forbes predicts prices could surge to £43,000, harking back to levels last witnessed in November 2021.
Crypto Regulation
Moreover, the tightening grip of regulations and surveillance within crypto markets might prove advantageous in the forthcoming year, bestowing greater legitimacy upon an industry historically lacking in safeguards. Recent steps, such as the UK government’s collaboration with 48 countries to combat tax evasion facilitated by crypto, demonstrate an effort to introduce the Crypto-Asset Reporting Framework (CARF) by 2027. It will commence its preparations in 2024.
Victoria Atkins, financial secretary to the UK Treasury, emphasized the commitment to thwarting crypto-enabled tax evasion. She said, “We will not allow criminals to use crypto to avoid paying their fair share.”
Investor Confidence
The evolving credibility lent to crypto markets by institutional heavyweights, coupled with regulatory backing, seems to be bolstering investor confidence. Sentiment indices, such as the crypto fear and greed index, currently register a greed score of 69 (a surge from the previous fear score of 45). It might foreshadow an increase in demand. And consequent price upticks.
The recalibration of US inflation and its implications for interest rates stand as additional pivotal factors shaping crypto trends in the New Year. The US Federal Reserve reported a slight drop in inflation to 3.2% in October, down from 3.7% in September. With the prospects of stable interest rates, the constraints witnessed in much of 2023 might abate. It potentially signals a price upswing.
In summary, while the crypto realm remains inherently unpredictable, the confluence of ETF launches, the impending halving, regulatory strides, and macroeconomic shifts offer compelling indicators for an eventful 2024.
