YEREVAN (CoinChapter.com) – Bitcoin price approached $27,000 on June 20 for the first time in the past three weeks. While the 8% weekly uptick could fizzle out shortly, there are several reasons to expect a bull run above $30,000 in 2023-2024. Here are 5 of them.
Bitcoin Spot ETF approaching?
Exchange-traded funds, or ETFs, attract a broad range of investors seeking exposure to diversified portfolios of assets without enduring the risks. Thus, many fiat financial services companies offer Bitcoin ETFs to their customers. However, those are dealing with futures trading, as opposed to spot trading.
Spot trading carries greater risks, and as of June 2023, there have been no Bitcoin Spot ETFs approved in the United States. The world’s largest digital asset management company Grayscale applied for one in March 2022, getting a rejection. The US Securities and Exchange Commission (SEC) also rejected financial giant Fidelity’s plea for a Bitcoin Spot ETF in January 2022.
However, in the previous week, unconfirmed rumors claimed that BlackRock, the largest asset manager globally with $9.1 trillion under its wing, will file for a Bitcoin spot ETF in the near future, and so will Fidelity.
Notably, in 2021 BlackRock called Bitcoin an “untested asset” with a “very small market.” However, the flagship crypto has since become a tidbit considering its expanding adoption and undervalued price.
BlackRock has famously gotten 575 ETFs approved against a single rejection. Jan Van Eck, CEO of the global investment management firm VanEck, said on May 18 there is “no chance” that a Bitcoin Spot ETF will be launched in the US in the near future, according to a Bloomberg report.
However, if approved, it will attract a plethora of investors, boosting the price.
The growing fiat interest in the sector is not devoid of irony. Small retail investors could have seen the BTC market as a way of gaining independence from “Big Brother.” But with fiat giants stepping in, Bitcoin decentralization will remain a myth.
Hedge against regulatory pressure on altcoins
On June 5-6, the SEC filed a lawsuit against the two largest crypto exchanges in the US – Coinbase and Binance.US for violating US securities laws. Moreover, the regulator listed some 13 crypto assets as “unregistered securities,” including Cardano (ADA), and Solana (SOL).
No doubt, Bitcoin was the “king crypto” even before the SEC decided to wipe out the altcoin market. However, with the persisting regulatory crackdown, Bitcoin reaped benefits from its status clarity and reclaimed 50% market dominance for the first time in two years.
Accumulation and Continuous outflow from exchanges
Thus, the ongoing whale accumulation should come as no surprise. According to on-chain data provider Glassnode, large Bitcoin investors have been hogging more BTC coins since mid-May.
Accumulation Trend Score persists, as the largest of Whales (>10K BTC) continue to aggressively accumulate, whilst all other major cohorts experience heavy distribution.
tweeted the platform in early June.
Typically, the dissonance between whales and smaller fish tends to diminish. In detail, once whale accumulation persists, retail investors follow the large players’ lead, assuming they have more resources, hence, more accurate information.
Moreover, the outflow of BTC from exchanges continues, signifying holders’ growing determination to hold rather than sell.
BTC halving approaching in 2024
In detail, a Bitcoin halving is when the payout for mining a new block is halved, which happens after every 210,000 blocks (approximately four years). The first halving occurred in 2012, and the next is projected to occur in 2024 on block 840,000.
Notably, each of the three previous halvings brought on a bullish wave, albeit not immediately. Furthermore, Peter Brandt, the CEO of the trading firm Factor, noted that a Bitcoin price boost typically took 33 months “before the next stage.”
In May 2024, around the time of the fourth halving, another 10X leg up is possible, said the veteran investor. However, Brandt added that he did not believe BTC would manage such a massive uptrend.
According to a pseudonimous crypto analyst @CryptoTea_, halving is one of the main reasons behind BlackRock’s decision to file for a Bitcoin Spot ETF.
BlackRock understands the Bitcoin halving is less than a year away. New supply will decrease while demand continues to increase from worldwide hyperinflation. They are asset managers and need to capture bitcoin’s performance before their competitors do. You are watching game theory at work.
China provides unexpected stimulus
China has had a rocky relationship with Bitcoin for years. However, in contrast with the latest regulatory crackdown in the US, Hong Kong is increasingly solidifying its status as a crypto hub in Asia despite most other countries taking a cautious approach.
According to early June statistics, crypto users in Europe dropped by 12 million from 2022’s figure of 43 million. Asia, on the other hand, led the way with 260 million users as of May 2023, marking a whopping 100% growth from the previous year’s figure of 130 million.
In response, Hong Kong launched applications for licenses to run trading platforms and exchanges.
Trading of cryptocurrencies in the Chinese territory has been restricted to institutional investors and other professionals since 2018, but Hong Kong’s new regulations will allow retail trading as soon as the second half of 2023.
Julia Leung, CEO of the Securities and Futures Commission of Hong Kong, asserted the following:
Hong Kong’s comprehensive virtual assets regulatory framework follows the principle of ‘same business, same risks, same rules’ and aims to provide robust investor protection and manage key risks. This will enable the industry to develop sustainably and support innovation.
said the executive.
As the US steps away from crypto adoption, Asia steps in, with a widening clientele and clearer regulatory framework. Thus, the possibility of Bitcoin gaining momentum increases.
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