Bitcoin is the most important crypto coin in the world, with the highest market capitalization level and the ability to fundamentally change the market through its price movements. Since the beginning of 2024, it has been basking in the effects of a bullish run, but corrections have now entered the picture and appear to be here to stay. However, the general market sentiment remains optimistic, owing to the fact that the values have remained consistently high, closer to $70K, rather than the previous low levels that affected investor portfolios over the past couple of years.
The ETFs are considered to be primarily responsible for the growth, and the added effects of the halving will only serve to propel the price elevation even further, but is that sufficient reason to expect a six-figure price until the end of the year? And what kind of BTC price prediction should you trust when creating your trading strategy for the rest of the year?
Institutional inflows
The adoption of exchange-traded funds has been hailed as a total game changer long before the asset class was officially approved for use. The reason for the hype is that ETFs were expected to increase institutional participation levels since most businesses and enterprises are reluctant to get involved in the standard crypto market due to the perceived risks but would still like to enjoy the benefits that come with digital tokens. The predictions were proven to be correct and inflows arrived on the market, boosting prices and changing the landscape. Now investors are wondering if this factor could lead to a six-figure price in the upcoming month, as it would work alongside the halving and the ETFs.
$112K
In the final months of 2023, investors predicted that the price point would eventually climb to $100,000 in the Bitcoin ecosystem, but this change was only expected to arrive sometime around mid-to late 2025. However, the fact that values reached new all-time highs in March 2024 led many to say that the initial estimations were not sufficiently optimistic and that the elusive $100K level could be achieved and even surpassed in 2024. The market forecast takes the institutional capital into consideration, as well as the realized cap, which is the combined value at which the supply moves. At the moment, research shows that only the combined inflows associated with exchange-traded funds could add another $114 billion to the $451 billion tally.
General performance
The past couple of years haven’t been easy for crypto traders, so most have high hopes for 2024, which have so far been met as a result of the sustained price action. On April 20th, the halving finally arrived, and while the event is traditionally associated with a considerable climb, it will take a few months until the effects become visible for the entire marketplace. The climb will continue for several months in the aftermath, with the time being well-known for its volatility and price fluctuations that investors must remember to navigate carefully to avoid considerable losses that could outshine any gains.
Macroeconomics
The macroeconomic aspect is crucial for Bitcoin’s development, although digital tokens are traditionally believed to be wholly separate from standard financial marketplaces. It might be that the US central bank has finally reached the peak of the interest rate, an event that could act as a further catalyst for Bitcoin, which has traditionally been highly vulnerable to financial market movements and changes. When interest rates become more stable, Bitcoin will have the opportunity to provide investors with more attractive alternatives who are looking for other options for their capital. This is due to Bitcoin’s perceived ability to serve as a hedge in the face of scarcity and as a solution for those who want to move away from traditional finances and services.
Bull scenario
There are two main scenarios of how crypto markets could evolve throughout the rest of the year, and they are complete polar opposites, with one being bullish and the other bearish. In the case of the former, investors believe that it can only be maintained in the event that the market succeeds in remaining sturdy throughout the rest of the year. There are still concerns regarding the global economy, with several countries declaring themselves to have officially entered a period of recession, while others said that they only barely managed to avoid one. The United States is facing a further crisis as well as heightened debt obligations, and while there were several bank failures during the previous year, it’s important to remember that there’s no guarantee that the economy is out of the woods yet as the problems that led to the failures are still present.
If the monetary issues persist and the economy runs into further problems, Bitcoin will have to make use of its full resilience in order to keep growing and may keep progressing as a result of increased adoption rates. This might even be the year when BTC becomes more akin to fiat currencies, signifying the beginning of a new era in the world of digital finance.
Bear scenario
Could the bears make a return this year as well? After the solid growth at the beginning of the year, many would say that it is unlikely, but there are also many who would beg to differ. Many market participants remain reticent in regard to BTC’s long-term security, especially as block rewards have decreased following the halving. There’s also the short-term selling pressure to take into account, yet another factor that could hurt the general Bitcoin price. Possible issues on the blockchain, such as network congestion, will also conspire to the detriment of growth, while environmental concerns remain strong among those concerned about the toll mining is taking on the environment.
Notably, the White House has proposed a 30% tax on Bitcoin miners located in the United States. Some are worried that Europe could attempt to reintroduce a ban of proof-of-work consensus mechanisms, a move that almost changed the crypto environment in 2022, but which was ultimately rejected. The fact that the United States is also becoming hostile to crypto in general has made many feel apprehensive about the future of digital currencies. Naturally, all this adversity doesn’t bode well for the prices either.
Bitcoin is the most important crypto in the world, but that doesn’t make it any less vulnerable to the changes and upheaval surrounding the financial landscape at the moment. If you want to ensure that your portfolio registers good performance during the next year, pay attention to the fluctuations and adjust your plans accordingly.