As we head into the transformative year of 2024 for Bitcoin, several pivotal events are expected to reshape the cryptocurrency landscape.
The early approval of a Bitcoin exchange-traded fund (ETF), a possible rate cut and the long-awaited Bitcoin halving are among the key developments. Additionally, the Financial Accounting Standards Board’s (FASB) decision to adopt fair value accounting for Bitcoin marks an important milestone.
On December 13, CryptoState lead analyst James Van Straten posted on X what he thinks will happen to Bitcoin next year:
“Bitcoin Potential 2024 Timeline
Jan: ETF Approval
Feb: ETF Trading (Based on GLD)
March – Potential for first-rate cut
April – Halving
May – November: Rate cuts and liquidity
December – FASB is expected to adopt fair value accounting for Bitcoin.”
ETF Approval and Trading: A New Era for Bitcoin
January 2024: Approval of a Bitcoin ETF, similar to the GLD (Gold ETF), is a game-changer. It signifies a monumental shift in regulatory attitude towards cryptocurrencies, offering mainstream investors a regulated vehicle to invest in Bitcoin.
February 2024: Following approval, Bitcoin ETF trading begins, attracting a new wave of institutional and retail investors. This development is expected to improve liquidity and stabilize the Bitcoin market.
March 2024: The possibility of a first rate cut in March 2024 signals a crucial juncture. This move, while typically aimed at stimulating the economy, also suggests caution, hinting at underlying economic challenges. Investors and analysts will closely monitor this period for its implications on the financial market in general and on Bitcoin.
April 2024: The Bitcoin halving in April 2024, a scheduled event that will halve the reward for mining new blocks, is expected to have a significant impact on its value. Historically, halving events have resulted in substantial price increases, as reduced supply pressures meet steady or increasing demand.
May – November 2024: This period is expected to be marked by further rate cuts and increased liquidity, which could drive further investment in Bitcoin. However, caution is advised as these measures may react to an imminent economic slowdown.
December 2024: Michael Saylor, founder of MicroStrategy, highlighted the FASB’s decision to adopt fair value accounting for Bitcoin for fiscal years beginning after December 15, 2024. This move is a significant endorsement of the legitimacy of Bitcoin as a treasury reserve asset for corporations globally.
On December 13, Michael Saylor posted the following on X:
“FASB has officially adopted Fair Value Accounting for #Bitcoin for fiscal years beginning after Dec 15, 2024. This upgrade to accounting standards will facilitate the adoption of $BTC as a treasury reserve asset by corporations worldwide.”
According to FASB, early adoption is permitted for both interim and annual financial statements that have not yet been issued. If amendments are adopted in an interim period, they must be adopted as of the beginning of the fiscal year that includes that interim period.
Long-Term Outlook: Bullish on Bitcoin
Amid these developments, a warning note looms about a possible pre-recession bull trap. The Federal Reserve’s rate cuts may not mean an economic improvement but rather a strategy to prevent a collapse. Investors are advised to remain cautious as signs still point to a recession.
Despite short-term uncertainties and possible economic recession, the long-term outlook for Bitcoin remains bullish. The confluence of regulatory acceptance, increased corporate adoption, and the halving event contribute to a positive long-term trajectory for Bitcoin.
By Audy Castaneda
