The price of Bitcoin (BTC) could jump above $50k before the end of January based on these factors, according to Matrixport.
Bitcoin has carried on its impressive form from 2023 into the new year, breaking above $45,000 in the hours leading up to press time. However, Asia-based crypto trading firm Matrixport expects even more gains in the coming weeks, having predicted earlier that the leading cryptocurrency would surpass $50,000 before the end of January.
The prediction originally made on December 21 has proven largely true, with the price of Bitcoin consolidating through the holiday period before its latest breakout. The Asian crypto trading firm specified factors that would continue to drive Bitcoin’s rally in 2024.
Bitcoin ETF, Supply Shortage, and Halving to Boost BTC Price
Matrixport’s latest report outlines four factors that will drive Bitcoin’s continued rally. The first among those factors is the pending approval of spot Bitcoin ETFs in the United States. Contrary to expectations that approval will come between January 8 and 10, Matrixport expects approval much earlier.
The approval will drive Bitcoin up significantly and will not be a “sell-the-news event” as many had anticipated. The firm predicts such an outcome since an ETF will open the opportunity for more institutions to gain Bitcoin exposure and realize that it could be used as collateral to buy even more assets.
Another factor that would drive BTC’s price is the ongoing supply shortage. With 70% of bitcoins unmoved in the past year, Matrixport cites that less and less bitcoin is now available on exchanges. Investors have learned their lessons from the FTX fallout and are now more adept with cold storage options, leaving fewer coins available for potential buyers.
Meanwhile, Bitcoin’s on-schedule halving in April 2024 would create an even higher supply shortage. Matrixport notes that miners are less reluctant to sell bitcoins ahead of halving, potentially reducing the amount of coins that would be available to buyers.
Lastly, the U.S. Federal Reserve’s pivot to a dovish stance means there would likely be more capital flooding the markets in search of investment opportunities. With risk-on assets like crypto having performed well in the past year, institutional investors would likely key into the opportunity and not miss out on another rally.
In a nutshell, the firm predicts that the “Bitcoin price move this year could surprise everybody.” While there is no way to determine how surprising Bitcoin’s price will turn out, many fund managers predict a six-figure BTC price in 2024. Such an increase would represent an over 100% increase from Bitcoin’s current price of $45,3000 at the time of writing.
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