Bitcoin Surges to Yearly Highs: Review and Predictions
Date: 2024-01-09 Author: Dima Zakharov Categories: BLOCKCHAIN
Bitcoin's Remarkable Rise
On Monday, January 8, 2024, Bitcoin achieved a new yearly high, reaching $47,218 within a 24-hour period, according to CoinMarketCap. This price level had not been reached since the beginning of April 2022.
Bitcoin's upward momentum can be attributed to the anticipation of the approval of a spot Bitcoin ETF in the United States. Market participants believe that this financial instrument will attract institutional funds into the industry, providing a boost to Bitcoin and other cryptocurrencies. To capitalize on the potential approval of the ETF, market participants are buying Bitcoin, driving its price higher.
Back in October 2023, Bloomberg analysts predicted the approval of a spot Bitcoin ETF in the United States by early 2024, possibly before January 10.
As the approval of the ETF nears, its issuers have disclosed information about fees. For instance, Blackrock's Bitcoin ETF will charge a 0.2% fee in the first year, making it one of the most competitive offerings in the market. Competing companies, such as Valkyrie, have proposed higher fees, with their rate set at 0.8%.
Members of the cryptocurrency community have interpreted these fee disclosures as a sign of the imminent approval of spot Bitcoin ETFs in the United States. Additionally, the publication by the U.S. Securities and Exchange Commission (SEC) warning investors about the fear of missing out (FOMO) further hints at the approaching significant event.
Positive Bitcoin Momentum
Expectations of a Federal Reserve interest rate cut have also contributed to the positive trajectory of Bitcoin. On January 11, the latest U.S. inflation data will be released, and market participants are anticipating a positive report that could lead the Federal Reserve to consider lowering interest rates. Such changes could make high-risk assets like cryptocurrencies more appealing.
Bitcoin Predictions: What Lies Ahead?
Market participants hold differing opinions on what investors should expect from Bitcoin. Some believe that Bitcoin's behavior will depend on whether the SEC approves spot Bitcoin ETFs by January 10, 2024. While some are confident that the ETF launch will support Bitcoin's growth, others speculate that a positive SEC decision might trigger a Bitcoin sell-off, as the anticipated influx of institutional money may not be immediately realized.
Several market participants also foresee the potential for Bitcoin to correct from its current levels. Notable cryptocurrency trader Doctor Profit and analyst Michael van de Poppe have supported this Bitcoin price correction prediction. However, there are also those who expect Bitcoin to reach $50,000 within the week, a prediction endorsed by blogger AltcoinGordon.
In conclusion, the cryptocurrency community's outlook on Bitcoin's future is diverse. Even if the SEC denies the launch of ETFs on Bitcoin, experts believe that Bitcoin's positive momentum will continue, albeit at a slower pace, with the upcoming halving event in late April 2024 likely playing a significant role in driving the cryptocurrency to new highs.
