Bitcoin topped $50,000 on Monday for the first time since December 2021, according to CoinGecko data, suggesting confidence in the digital currency is growing after a turbulent two years of scandals and bankruptcies.
Thanks to inflows into exchange-traded funds, speculation of future monetary easing, and the upcoming halving, “tailwinds for digital assets are the strongest they’ve been in quite some time,” Christopher Newhouse, a DeFi analyst at Cumberland Labs, told Fortune.
BTC plunged 64% in 2022, reaching lows of $16,000, owing in part to the implosion of FTX. But over the past 12 months, it has increased approximately 129%—although the price remains below the all-time high of almost $69,000 reached in November 2021.
When the Securities and Exchange Commission approved 10 spot Bitcoin ETFs on Jan. 11, retail and institutional investors gained exposure to BTC without the need to hold the underlying asset. The merging of traditional finance with digital assets, with firms like BlackRock and Fidelity launching funds, has been hailed as watershed moment for crypto.
But despite anticipation that new retail and institutional investors would turbocharge a bull market, BTC initially looked volatile.
The underwhelming impact of the SEC’s approval on BTC prices was largely caused by outflows of over $6 billion from the decade-old Grayscale Bitcoin Trust, which had operated as a closed-end trust, previously locking in investors who are now free to liquidate, according to Bloomberg. The GBTC exodus helped push prices down to $39,505, with BTC falling approximately 15% from the approval date.
But it’s now clear that outflows are slowing, and the price is catching back up. In the first few weeks of trading, daily outflows averaged $500 million, but they’ve been steadily declining since Jan. 26. On Friday, outflows totaled just $51.8 million, according to Bloomberg data, the lowest since the approvals.
Meanwhile, inflows into the other nine ETFs have been accelerating: Last week, the cumulative net inflow was approximately $1.2 billion—almost half of the total so far.
“This strong buying-spot pressure is driving the price up, and that’s the main driver of the recent growth,” Matteo Greco, a research analyst at investment firm Fineqia International, told Fortune.
If the ETF inflows continue at this pace, gaining roughly $1 billion per week, “Bitcoin will go up every day,” said Geoff Kendrick, Standard Chartered’s head of digital assets research.
On top of this, the Federal Reserve has indicated that interest rates will be cut in the spring, which “provides another tailwind for Bitcoin prices,” Markus Thielen of 10x Research told Fortune. During periods of high interest rates, riskier assets like Bitcoin, which are highly liquid and more volatile, tend to be less attractive.
Meanwhile, Dave Nadig, recently VettaFi’s financial futurist, attributes growth to baked-in optimism ahead of April’s halving, where the financial reward miners receive halves, thereby cutting supply, as smaller miners are forced out of the market.
“The halving gives a reason for everybody to be paying attention to Bitcoin,” he told Fortune. “There is a mechanical reason that we should expect the number to go up, which is that the supply is going offline.”
Indeed, a bull market has followed each of the previous four halving events. When the first took place in November 2012, the price of BTC was around $12. One year later, it had risen to over $1,000. BTC was at $8,755 at the time of the most recent halving in May 2020 before its mad rush toward $69,000 the following year.
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FAQs
Bitcoin breaks $50,000 for the 1st time in over 2 years due to ETFs, Fed cuts, and the upcoming halving. Bitcoin topped $50,000 on Monday for the first time since December 2021, according to CoinGecko data, suggesting confidence in the digital currency is growing after a turbulent two years of scandals and bankruptcies ...
When was bitcoin halving in 2024? ›
The most recent bitcoin halving took place on April 19, 2024. At the time, the reward for each block of mined bitcoin was cut in half from 6.25 BTC to 3.125 BTC. This event occurs approximately every four years, or more precisely, every 210,000 blocks.
Will bitcoin crash after halving? ›
10 Years of Decentralizing the Future. JPMorgan said it expects bitcoin to fall after the reward halving. The bank's analysis shows that the cryptocurrency remains overbought. Miners will be most affected by the event, the report said.
Will bitcoin go below 50k again? ›
The price of bitcoin is unlikely to fall below $50,000 unless major events like negative spot bitcoin ETF flows occur, according to Mike Novogratz. Bitcoin is currently in price discovery mode, and it could reach $100,000, said the Galaxy Digital CEO.
How much will 1 bitcoin be worth in 2030? ›
Bitcoin (BTC) Price Prediction 2030
| Year | Price |
|---|
| 2025 | $ 70,267.56 |
| 2026 | $ 73,780.94 |
| 2027 | $ 77,469.99 |
| 2030 | $ 89,681.20 |
1 more rowOur most recent Bitcoin price forecast indicates that its value will increase by 14.58% and reach $66,426 by May 03, 2024.
How much will 1 Bitcoin be worth in 2025? ›
What will Bitcoin be worth in 2025? The BTC price may trade between $92,500 and $94,800 in 2025.
Is Bitcoin halving a good thing? ›
While Bitcoin halving is generally viewed as a positive event, there are inherent risks, particularly in the short term. The anticipation leading up to the halving can create speculative market behavior, potentially resulting in increased volatility.
Should you buy Bitcoin before or after halving? ›
Although data insinuates that it isn't too late to buy Bitcoin and it remains an attractive investment before the April halving, investors must remember that Bitcoin rewards those who hold and weather the post-halving declines.
What happens to my Bitcoin after halving? ›
After the halving, the block reward or subsidy associated with validating each new block of transactions on the Bitcoin network is cut in half. The block subsidy is the newly-created bitcoin that is included in the block as a reward to the associated miner.
In its 2023 Big Ideas report, Ark Invest laid out several price targets for Bitcoin. The report sees Bitcoin hitting price targets in 2030 of $257,500 in the bearish forecast, $682,000 in an average market and $1.48 million in a bullish market.
Is it worth buying Bitcoin now? ›
Unfortunately, it's also incredibly volatile. For that reason, while current market conditions are favorable for anyone considering buying Bitcoin, it is an asset you should purchase only at your own risk. Because while Bitcoin may have the potential for significant returns, you may also lose most of your investment.
Who owns the most Bitcoin? ›
Satoshi Nakamoto, the pseudonymous creator of Bitcoin, is believed to own the most bitcoins, with estimates suggesting over 1 million BTC mined in the early days of the network.
How many people own 1 Bitcoin? ›
In reality, only 2.3% of all Bitcoin owners own 1 BTC or more (worth around $35K per Bitcoin as of November 6th, 2023). In addition to Bitcoin ownership primarily spread across multiple small holders, most of Bitcoin's largest holders represent “the many” rather than a few.
What will Bitcoin be worth in 2040? ›
By 2040, the maximum price of the BTC Coin is projected to be around $5,69,240.60. Our average price forecast for Bitcoin is $5,57,632.74 in 2040. Conversely, if the market turns bearish, the minimum price level of BTC Coin could fall down to $5,42,838.40 by 2040.
What will Bitcoin be worth in 2050? ›
Bitcoin (BTC) Prediction for 2040 and 2050
If we draw a line connecting Bitcoin's historical lows, we get a prediction of $1.3 million by 2030 and a staggering $200+ million by 2040 and 2050, which would put its market cap at an unreasonable $4 quadrillion. By this time, this asset class will likely be matured.
How long after halving does Bitcoin peak? ›
Thomas Perfumo, head of strategy at Kraken, said Bitcoin prices historically peak 12 months to 18 months after a halving event but noted that the cryptocurrency already hit an all-time high less than two months ago, “which is earlier than in prior market cycles.”
Is Bitcoin halving good or bad? ›
Again, the only way that Bitcoin has a price is because traders decide that it's worth something. Of course, the halving has some effects on the Bitcoin ecosystem. For example, the reduced reward for miners means that Bitcoin's price will need to rise over a longer time frame for miners to continue mining profitably.
What is the prediction for Bitcoin cash in 2024? ›
Based on our technical indicators, Bitcoin Cash's 200-day SMA will rise in the next month and will hit $ 388.24 by Jun 28, 2024. Bitcoin Cash's short-term 50-Day SMA is estimated to hit $ 480.73 by Jun 28, 2024.
Will Bitcoin halving affect other coins? ›
Altcoins (alternative coins), essentially any cryptocurrency other than Bitcoin, are set to receive a knock-on effect from the halving. The interconnectedness of Bitcoin and altcoins goes well beyond price correlation. The ramifications are much deeper than that.
