Could Bitcoin hit a new record high within weeks?
After surpassing $59,000 early on Wednesday, Bitcoin has now rallied to a 2024 high of $64,000!
The world’s largest crypto by market cap is edging ever closer to the all-time high of $69,000 in November 2021.
Institutional Drivers of Bitcoin Surge: Spot ETFs and BlackRock Inflows
As such, should this current momentum continue, we firmly believe Bitcoin could exceed the previous record high within weeks. As I was quoted by Investing.com, Financial Mirror, Pound Sterling Live, France 24, Bitcoin Insider, Barron’s, Market Forces Africa, and Shares Magazine, amongst other media, one of the key drivers behind BTC’s recent surge is the mounting interest from institutional investors, particularly via the introduction of spot Bitcoin Exchange-Traded Funds (ETFs).
The approval and introduction of spot Bitcoin ETFs have offered institutional investors a simpler and regulated avenue for entering the crypto market. These monitor the cryptocurrency’s price directly rather than through futures contracts.
This has hastened institutional adoption, boosting liquidity and stability within the market.
Indeed, yesterday, it was revealed that BlackRock’s Bitcoin ETF took in $520 million on Tuesday. The second-largest inflow of any ETF in a day.
The spot ETF approval by the US Securities and Exchange Commission is seen as a breakthrough in Bitcoin’s move towards mainstream acceptance.
So, as more institutional participants step into the Bitcoin arena, the rising demand for Bitcoin has been pushing prices skywards. The inflow of institutional capital also brings about a level of stability to the market. This will likely reduce some of the volatility typically linked with cryptocurrencies.
Furthermore, another factor leading to Bitcoin’s optimistic outlook is the upcoming halving event.
Halving Event and Price Surge Anticipation
Bitcoin experiences a halving event approximately every four years, cutting the rate of new coin creation in half. This reduction of new Bitcoin into the market leads to a potential supply shock, historically associated with substantial price surges.
The next halving event is due to take place in April. This typically precedes considerable bull runs, according to historical data.
As the issuance of new Bitcoin decelerates, the existing scarcity of digital assets becomes more pronounced. This usually results in heightened demand and, consequently, elevated prices.
Growing retail interest has propelled bitcoins price. This along with institutional participation and the buzz surrounding the halving.
A Unified Landscape of Institutional and Retail Investors
The rising acceptance of cryptocurrencies, marked by major firms now embracing Bitcoin as a valid form of payment and traditional financial platforms integrating digital assets, is drawing in a more diverse selection of retail investors.
The accessibility provided by user-friendly exchanges and mobile apps has made it simpler than ever for retail investors to get involved in the crypto market. Therefore contributing to the democratisation of cryptocurrency investing. This fusion of institutional and retail interest is fostering a vibrant and resilient ecosystem. An ecosystem that has the potential to propel Bitcoin to unprecedented levels.
Of course, there are no guarantees, and it’s important to note that investors should recognise the highly speculative nature of cryptocurrencies.
However, the mammoth interest in spot ETFs and the anticipation surrounding the upcoming halving event are likely to sustain the current momentum. This momentum could potentially drive Bitcoin to exceed the $69,000 mark.
Read my previous blog post here.