BTC’s potential to reach $60,000 in 2024 is supported by the recent launch of Bitcoin spot ETFs in the United States. Macroeconomic factors such as the Federal Reserve’s planned interest rate cut in 2024 could increase Bitcoin’s appeal. CoinShares analysts predict that a 10% inflow of current assets under management could push the BTC price close to $60,000.
In a constantly evolving crypto ecosystem, the possibility of Bitcoin reaching $60,000 in 2024 is gaining popularity. This prediction coincides with the recent launch of Bitcoin spot exchange-traded funds (ETFs) in the United States.
This milestone has significantly expanded the investor base, potentially injecting about $3 billion into the Bitcoin market, according to CoinShares.
Macroeconomic Factors Driving Bitcoin (BTC) Price in 2024
A confluence of macroeconomic factors is influencing Bitcoin’s trajectory. Monetary policy, especially in the US, plays a crucial role.
Rising interest rates have shifted attention to other alternative stores of value, such as US Treasuries. However, the Federal Reserve’s planned interest rate cut in early 2024 could reinforce Bitcoin’s appeal, juxtaposing it against traditional assets.
The weakening appeal of the US dollar amid geopolitical and supply chain changes further strengthens Bitcoin’s position. Concerns about the sustainability of US debt point to declining confidence in the dollar, which inversely benefits Bitcoin.
Inflation dynamics in developed countries, similar to post-2009 trends, suggest a likely Fed rate cut. This monetary easing could increase Bitcoin’s appeal in 2024 compared to US Treasuries, given Bitcoin’s fixed supply nature.
Another factor is the increasing correlation between Bitcoin and traditional assets. This is driven by investors seeking stability amid policy changes and market tensions. This trend is expected to be temporary and Bitcoin will return to its typical inverse correlation with the US dollar in the coming year.
Halving Cycle and Regulations in 2024
The high correlation between fixed income and equities has guided investors towards more diversified assets, such as Bitcoin. Its potential as an effective diversification tool beyond traditional asset classes is increasingly recognized.
The Bitcoin mining industry is also changing, which is an integral part of its price dynamics. The mining cycle, influenced by the Bitcoin price cycle, halvings and delayed equipment deployment, is expected to undergo significant changes in 2024.
The upcoming April halving is especially crucial. This is because it can affect the profitability of mining and the dynamics of market supply.
In terms of regulatory outlook, 2024 looks promising. The US Securities and Exchange Commission’s (SEC) approval of Bitcoin spot ETFs sets a positive tone.
CoinShares analysts predict that an influx of 10% of current assets under management (AUM) could send the price of Bitcoin close to $60,000:
“While predicting the exact scale of the post-launch investment influx is difficult, a conservative estimate suggests that 10% of the current AUM, which is about $3 billion, could lift the price of Bitcoin to around $60,000. Dollars”.
In particular, there is a global trend towards regulation rather than outright bans, with countries such as Hong Kong and Japan providing guidance on stablecoins and the EU advancing the Markets in Crypto Assets Regulation (MiCA).
The general sentiment towards digital assets, especially Bitcoin, is increasingly positive. This amalgamation of macroeconomic factors, regulatory developments, and intrinsic market dynamics makes a strong case for Bitcoin’s continued rise in 2024.
By Audy Castaneda
