In 2023, we saw a revival in the crypto space, with Bitcoin and Solana surging by 128% and 495%, respectively. Crypto equities rose 138%, backed by significant commitments from financial giants like BlackRock and Fidelity.
In this article, we've gathered top predictions for crypto in 2024 — these projections are informed estimates, not certainties.
Crypto's future outcomes are shaped by various conditional factors, making accuracy subject to change. Also, please note that the information shared here is not intended as investment advice. We recommend exercising caution and doing your own research before making any financial decisions.
1. Bitcoin's rebound will continue
Bitcoin (BTC) dominated in 2023, surging by 128% and outperforming the S&P 500 (21%), gold (12%), and bonds (2%). Forecasts predict this momentum will persist in 2024, with Bitcoin hitting $70,000+ and setting a new record.
Two key drivers support this projection. Firstly, the anticipated launch of a spot Bitcoin ETF in early 2024 is poised to attract substantial capital from both retail and institutional investors, boosting Bitcoin demand. Additionally, the upcoming Bitcoin halving in April or May 2024 will slash annual new Bitcoin supply in half, a significant $6.2 billion reduction at current prices.
Bloomberg's ETF analysts predict a 90% likelihood of approving a spot Bitcoin ETF in early 2024 — promising odds. Yet, the impact goes beyond launch; the ETF must amass significant assets for a substantial market effect.
Other studies indicate spot Bitcoin ETFs could seize 1% of the $7.2 trillion U.S. ETF market, translating to a remarkable $72 billion within five years.
Bitcoin halving
The Bitcoin halving slashes the miner reward rate by half every four years. Currently at 1.75%, it drops to 0.85% in approximately April. Historically, halvings drive substantial price hikes, averaging over 128%. A surge of this scale could propel Bitcoin to $90,000 — a record high.
With only 2.3 million coins available for purchase on exchanges — the lowest since 2017 — this is the first time in Bitcoin's history with fewer coins than the prior halving. Brace for a historic supply shock because crossing the six-figure mark for Bitcoin in 2024 wouldn't be surprising.
2. Ethereum will perform better in 2024
Ethereum (ETH) is gearing up for a significant turnaround in 2024 after taking a backseat in 2023. While it gained a respectable 80%, it trailed behind altcoins like Solana (900%) and Avalanche (250%).
So, what's the game-changer that can turn ETH's woes around? Enter EIP-4844, a critical upgrade scheduled for the second half of 2024. This update will slash transaction costs and catapult throughput to 100,000 transactions per second, tackling key challenges hindering Ethereum's progress.
Following The Merge in 2022, which shifted Ethereum to proof of stake, EIP-4844 is part of a series of upgrades aiming to elevate Ethereum to a level that can advance crypto's mass adoption.
Despite its 2023 performance, Ethereum remains the go-to blockchain for crypto use cases like decentralized finance, NFTs, and yield farming. With the added boost from EIP-4844, we predict that Ethereum will reaffirm its dominance in decentralized finance in 2024
Sharding
Ethereum's rise in popularity includes plans for scalability improvement. However, the anticipated introduction of sharding, a key scalability solution, will likely face delays. Sharding involves breaking the blockchain into smaller components, boosting transaction speed. The timing of its implementation remains uncertain.
Regulatory clarity
Ethereum might gain regulatory clarity in 2024, potentially boosting investor confidence. This could elevate Ethereum's status as an asset, expanding opportunities for developers and investors. While the project is evolving, a well-defined regulatory framework holds significant potential benefits for Ethereum's growth and security.
3. The crypto market will expand
Crypto's past performance indicates a promising 2024. Despite wild price swings, the industry has seen remarkable expansion. Analysts predict a positive trend, backed by steady growth since inception. Confidence in crypto tech is rising, fueling optimism for 2024.
The expected growth in 2024 stems from increased adoption by businesses. As more companies embrace blockchain, demand for skilled professionals will rise, opening up new job opportunities and driving further industry development.
The bear market will end
Crypto analysts anticipate the bear market's end in early 2024, expecting a rally. The industry's resilience during challenging times fuels optimism for improved performance, offering investors higher returns and increased liquidity. The expected influx of businesses into the crypto space further supports this positive outlook.
A subsequent bull market might come following the end of the bear market. This lower-risk opportunity could attract more investors and traders, boosting profits and liquidity. The enhanced market performance may also increase consumer confidence in digital currencies, encouraging broader adoption in day-to-day transactions.
Events that will shape the 2024 Crypto Market
- Bitcoin ETF decisions: Keep an eye on the Bitcoin ETF rulings, a major focus in early 2024. They're expected to make significant waves in the crypto market headlines.
- Bitcoin Halving in 2024: The upcoming Bitcoin halving event is set for April or May 2024, impacting miner rewards. Historically, such events have acted as bullish catalysts for Bitcoin prices.
- Crypto regulations: Watch out for regulatory developments. The SEC's legal battles with issuers like Ripple and exchanges like Coinbase, Binance, and Kraken could clarify digital asset classification. U.S. Congress might also introduce more crypto laws.
- Central Bank Digital Currencies (CBDCs): More countries will launch CBDCs in 2024. The Bahamas and Jamaica have already taken the lead, with over 100 countries exploring the possibility.
- Interest rates and inflation: The Federal Reserve's actions to manage a soft landing for the U.S. economy could influence the crypto market. A mild recession might not significantly impact Bitcoin prices.
Final thoughts
In summary, 2024 holds immense promise for the cryptocurrency market, building on the positive trends of later 2023. With Bitcoin's potential surge, Ethereum's pivotal upgrades, and the anticipated end of the bear market, the crypto space is poised for significant growth.
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