With everything going on in the crypto world, sentiment continues to shift rapidly. Perhaps no cryptocurrency reflects this volatility better than Bitcoin (BTC-USD) in the wake of its spot ETF approvals, ongoing SEC battles in the sector, and the upcoming U.S. election.
Indeed, there are many catalysts to consider that could change Bitcoin’s direction in 2024. How the U.S. dollar holds up, where interest rates are headed, and how the overall macro backdrop changes are among three factors investors need to consider.
That said, for those taking a bullish angle on this token, here are some factors to consider.
Bullish Outlook
Bitcoin has continued to fluctuate to start the year, surging immediately following the approval of spot ETFs, and selling off remarkably since then. That said, Bitcoin prices appear to have found some sort of an equilibrium around $42,000 per token, with bulls eyeing a breakout above $45,000 for an indication this rally could continue.
Notably, various institutional investors are adopting Bitcoin as an asset class, with recently-listed spot Bitcoin ETFs providing an avenue for portfolio diversification. Thus far, the uptake with these ETFs has underwhelmed, but that’s a narrative that could change. With only 3.3% of Bitcoin’s total supply traded in the funds, capital flows into these funds could drive positive supply/demand fundamentals for Bitcoin, providing a floor underneath its price.
Moreover, expectations are high with the upcoming Bitcoin halving set for some time in April. Historical data shows the large impact of past halving events, with Bitcoin typically surging both before and after these events. We’ll have to see if history will be our guide this time around, but the overall trend is bullish.
New Price Target from Cathie Wood
Price targets from growth investors can sometimes be outlandish, and Cathie Wood has been known to put some pretty out-there price targets on certain stocks and assets in the past. However, some of her previous calls have worked out, and her general predictions on key sectors has proven to be prescient during previous bull market rallies. Thus, her price prediction on Bitcoin is one many investors consider.
Cathie Wood’s ARK Investment Management predicts an even more bullish trajectory for Bitcoin, with Bitcoin prices potentially headed into the six-figure realm in 2024. Much of this prediction has to do with capital flows and the upcoming halving, catalysts most investors are focusing intently on. Additionally, a rise in interest around speculative assets amid interest rate declines could create the kind of upward spiral Wood is looking for.
Cathie Wood has touted Bitcoin’s value compared to gold in the past, and that’s another key metric her team uses in suggesting where Bitcoin could head. While I’m skeptical of this approach, it’s one way to think about Bitcoin, and it’s something many bulls continue to be focused on when valuing this store of value asset.
Bitcoin’s Bull Thesis Could Play Out
I have no idea where Bitcoin will end 2024 at, and take all price predictions around this token with a grain of salt. However, I do think the bull thesis around Bitcoin remains strong, and there could be a number of catalysts that materialize this year that lead to a speculative surge in long-duration assets like Bitcoin.
Whatever happens, Bitcoin will certainly be an asset of focus for many investors in 2024. This cryptocurrency stands tall amid the pack, and will likely retain its status as the leading crypto in the market for some time. Thus, for many looking to diversify into this space, Bitcoin will remain the gold standard. And if you believe the capital inflows story, this is a token that’s worth considering this year.
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 InvestorPlace.com Publishing Guidelines.
