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Executives in the cryptocurrency industry have called the start of a new bull run with a growing number of voices calling for new all-time highs for bitcoin in 2024 above $100,000.
Bitcoin has risen more than 120% this year, with many optimistic about the boom continuing into 2024.
“It feels that way [2023]was a year to get ready for the bull run still ahead. But the sentiment is very hopeful for [2024] and 25,” Ledger CEO Pascal Gauthier told CNBC in an interview last week.
The digital currency’s last record high of nearly $69,000 was hit in November 2021.
Since then, the crypto industry has been hit with a series of issues from the collapse of coins and projects to bankruptcies and criminal trials. FTX, once one of the world’s largest exchanges, collapsed with its founder Sam Bankman-Fried sentenced to more than 100 years in prison after being found guilty on seven counts of criminal fraud.
Meanwhile, Binance chief Changpeng Zhao pleaded guilty to criminal charges and stepped down as the company’s CEO as part of a $4.3 billion settlement with the US Department of Justice.
Many in the industry see the two cases ending as a line drawn under issues that have plagued the crypto market.
“I think that once you get the speculative phase out of the way, which I think we’re almost done, probably not quite done yet, then you can get real builders that focus on the technology and the problems that can solve. , rather than just having a giant digital casino for people to trade,” Lightspark CEO David Marcus told CNBC in an interview last week.
Marcus, the former leader of Facebook’s failed Diem stablecoin project, is now working on technology to improve bitcoin as a payment network.
Now that those issues are out of the way, investors are focused on what the industry sees as positive developments. The first is the growing excitement that a bitcoin exchange-traded fund, or ETF, may soon be approved. This could bring in larger traditional investors who previously didn’t want to touch crypto.
“I think what the ETF really means is that bitcoin is going mainstream, and that’s what people have been waiting for,” Gauthier said.
The second development is the bitcoin halving, which occurs every four years and is scheduled for May 2024. Halving is when miners, who are entities that maintain the bitcoin network, see the rewards for their work cut in half. This puts a cap on the supply of bitcoin – of which there will only ever be 21 million coins – and is often a factor behind a new rally.
“A number of market participants expect a bull run some time after the halving, but given the ETF news, we could very well have a run before it leaves most investors on the sidelines. This could lead to a massive run to the upside in causing the price,” Vijay Ayyar, vice president of international markets at cryptocurrency exchange CoinDCX, told CNBC.
There have already been some bold calls for bitcoin in 2024.
It started last week with Standard Chartered repeating an April price call that bitcoin would reach $100,000 by the end of 2024. The bank said it would be driven by the approval of numerous ETFs.
That would represent an increase of about 160% from Friday’s price of about $38,413, according to CoinDesk data.
Matrixport, which bills itself as a crypto-financial services firm, released a note last week predicting that bitcoin will reach $63,140 by April 2024 and $125,000 by the end of next year.
“Based on our inflation model, the macro environment is expected to remain a robust tailwind for crypto. Another decline in inflation is expected, prompting the Federal Reserve to likely initiate interest rate cuts,” Matrixport said in its report.
“Combined with geopolitical crosscurrents, this healthy dose of monetary support should propel Bitcoin to new highs in 2024.”
Many commentators see the easing of monetary policy as supportive of bitcoin, which is considered a risky asset. Meanwhile, some see bitcoin as a kind of “safe haven” asset to pour money into in times of geopolitical strife.
When asked if bitcoin would hit $100,000 in 2024, Gauthier said “maybe” but declined to give a price prediction.
“What we’re seeing are strong fundamentals,” he said.
Ayyar said the price of bitcoin is “consolidating” below a “key level” of $38,000, which is bullish for bitcoin. Once this level is broken, bitcoin could next rise to between $45,000 and $48,000, he said.
However, he warned that the rally, largely built on expectations of an ETF approval, could fail if the product is again rejected by regulators.
“An all-out ETF rejection could wreak havoc on this run as well, so definitely something to keep in mind,” he said.
Correction: This story has been updated to reflect bitcoin’s record high price.
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