The price of Bitcoin (BTC) just blew past the pivotal $65,000 mark as market analysts point two crucial catalysts impacting its price outlook.
After breaking the $60,000 resistance zone on February 28 for the first time since November 2021, many expected the price of Bitcoin to experience a mild correction.
The opposite is what has happened, as the premier cryptocurrency recently printed its most bullish weekly candle, having increased its value by $11,404 over the week, as pointed out by crypto analyst Raicher.
#Bitcoin just closed its Greenest Weekly candle ever!
$11,404 between open and close on Bitstamp. pic.twitter.com/6jRC6m8x18
— Raicher (@allanraicher) March 4, 2024
The Bitcoin rally is catalyzed by two major trends, including the spot Bitcoin ETF and the forthcoming halving event. These two events might significantly shape the future valuation of the coin.
Spot Bitcoin ETF – Driving Supply Crunch
The spot Bitcoin ETF market has shifted the paradigm with respect to institutional adoption. With a regulated avenue to buy Bitcoin, ETF issuers have stacked up more than 300,000 BTC, with more projected to come shortly. Notably, BlackRock and Fidelity Investments have dominated the scene.
At the moment, as much as 10,000 Bitcoin is acquired by ETFs daily, compared to a total of 900 BTC mined per day. According to top analysts like legendary investor Samson Mow, this supply-demand imbalance might push the price of Bitcoin to $1 million eventually.
Weighing in on the current outlook, SkyBridge Capital Founder Anthony Scaramucci foresees a rapid acceleration for Bitcoin should the ETFs control 1.7 million coins or 10% of the total supply.
When BTC ETFs get to 1.7mm coins they will likely control 10 percent of what is available. Coins have been lost since inception. They are at 776k now. The acceleration will happen quickly after that.
— Anthony Scaramucci (@Scaramucci) March 4, 2024
Bitcoin Halving
While the forthcoming Bitcoin halving event is a positive phenomenon that independently shapes the bullish sentiment in the price of BTC, it will serve as a major complement to the impact of spot Bitcoin ETFs in the long run.
At the moment, the Block reward for mining Bitcoin is pegged at 6.25 BTC. When the halving occurs, this will reduce to 3.125, resulting in 450 BTC mined per day, instead of the current 900 BTC. If the demand for BTC from spot Bitcoin ETF issuers is sustained, it might fuel an increased surge in the price of the asset.
At the moment, the retest of the past All-Time High (ATH) of $68,789.63 from its current price of $65,103.63 remains the key level watched by Bitcoin proponents in the short term.