Bitcoin Outlook 2024: Why Long-Term Crypto Investors Have Reason to Be Optimistic


  • Bitcoin’s (BTC-USD) recent spot ETF approval by the Securities and Exchange Commission matters.
  • Institutional investors could flood into the crypto sector, sending a wave of capital toward Bitcoin.
  • Other key tailwinds could propel this token to new all-time highs, assuming no major economic shocks.
Bitcoin - Bitcoin Outlook 2024: Why Long-Term Crypto Investors Have Reason to Be Optimistic

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Bitcoin (BTC-USD) remains the top cryptocurrency most investors remain focused on in 2024. That’s for good reason, given this is the first, and largest, crypto out there after all.

This year, Bitcoin received a pivotal win. The Securities and Exchange Commission (SEC) finally approved a spot Bitcoin ETF. This means that big-money investors looking to gain exposure to Bitcoin now have a publicly-traded vehicle to do so directly. More on that later.

But there are other key tailwinds investors are increasingly focusing on. Among the top items of note is an upcoming halving event, slated for April, that will cut Bitcoin mining rewards in half, and further limit supply growth. Historically, this has had a positive effect on Bitcoin’s price.

With that in mind, there’s a lot to be optimistic about as we traverse through a new year. Here’s more on what investors may want to focus on when it comes to Bitcoin.

Key SEC Approval Matters

SEC-approved spot bitcoin ETFs triggered market excitement, with bitcoin briefly hitting $49,000 post-launch before a retreat. Grayscale was among the 11 issuers who gained NYSE approval to list their spot ETFs, and saw an immediate surge of capital.

While some of this capital has since exited the ecosystem, I think that over time the trend will remain positive. Currently, there’s a wide range of fees charged by ETF providers, from 0.2% to 1.5%. I anticipate that a race toward zero will ensue, and institutional investors will get pretty close to zero-cost exposure to this crypto, if they so choose.

Now tradable in the U.S., spot Bitcoin ETFs have essentially opened the door for major institutional investors to come into this sector. Analysts predict fund inflows of $50-$100 billion in 2024, potentially transforming the $30 trillion wealth management sector. Bitcoin has surged 150% in 2023, gaining wider acceptance due at least in part to these ETF approvals.

Capital Inflows Will Continue to Be a Focal Point

The numbers are constantly changing when it comes to how much capital is being held in these ETFs. However, the most recent numbers I could find stipulation that around $4 billion worth of Bitcoin is now held in these funds.

That’s pretty impressive, despite some significant outflows from Grayscale’s fund (among the most prominent of the group). Notably, Fidelity’s Wise Origin Bitcoin Fund (CBOE:FBTC) and BlackRock’s iShares Bitcoin Trust attracted over $1.2 billion each, with IBIT having more than $1.4 billion in assets under management, compared to Fidelity’s nearly $1.3 billion.

Invesco’s ETF ranked third with steady growth, hitting its best inflow day at $63 million on Jan. 19. VanEck’s ETF passed $100 million in assets after its best inflow day. The BTC ETFs collectively gained $440 million in Bitcoin on their fifth trading day, led by BlackRock’s IBIT with 8,700 BTC, valued at nearly $358 million. 

Excluding Grayscale, nine ETFs acquired almost 68,500 BTC, valued at around $2.8 billion, since inception. The “Newborn Nine” experienced a 34% increase in daily trading volume by the fifth day, per data shared on Jan. 18.

Strong Bull Case

Bitcoin options certainly priced in a great deal of excitement heading into these approvals. And while Bitcoin’s token price has come down considerably as a “sell the news” narrative builds, I do think that the long-term catalysts we’re seeing play out before our eyes are important to consider.

Right now, Bitcoin is the only cryptocurrency regulators have been willing to stand behind. That means a lot, and suggests that this token ought to remain a core holding, for investors looking for exposure to crypto over the long-term.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

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