3 Events That Will Affect Bitcoin’s Trajectory in 2024

Looking back Bitcoin‘S (BTC 1.12%) In its 15-year history, there are several events that we can be confident have had a significant impact on its trajectory. Mt. Developments such as the creation of the first Bitcoin exchanges like Gox streamlined trading for early Bitcoin pioneers, and the recent approval of a spot Bitcoin exchange-traded fund (ETF) gave the cryptocurrency a new foothold on Wall Street. We have prepared it.

Be assured that there are many other transformative events that have yet to occur. Here are three developments that could happen this year that have the potential to add to Bitcoin’s historic price rise journey.

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A completely different half-life is formed than before.

Bitcoin is scheduled to undergo its fourth halving in mid-April. Halving is a process built into the Bitcoin code that reduces the supply growth rate by half approximately every four years. The current growth rate is around 1.75%, but after the next halving, it will fall below 1% to roughly 0.8%.

Historically, halvings have been a major catalyst for price increases. If the rate of supply growth decreases, the price must increase to adjust for the reduced number of new Bitcoins, even if demand remains constant. On average, the price of Bitcoin rises about 125% the year a halving occurs.

While past performance is no guarantee of future results, this halving is different from previous ones. That’s because for the first time, Bitcoin has new buyers in the form of Wall Street celebrities.

The following companies have been approved for Bitcoin ETFs: black stone Fidelity began accumulating Bitcoin at historic rates. Collectively, these new ETF sponsors already hold about 4% of the total supply of Bitcoin.

Unlike past halvings where the primary buyers of Bitcoin were retail investors, the institutions purchasing Bitcoin now have much deeper pockets and more capital. If the pace of accumulation continues, this halving could be particularly explosive. Especially considering that the number of Bitcoins available for purchase on exchanges is at its lowest level since 2018. Due to existing supply shortages, the halving will and potentially could increase pressure on Bitcoin. Promoting price surges of historic proportions.

Bitcoin Standard Acceptance

During the last cryptocurrency bull market, we saw a handful of companies announce their purchases of Bitcoin. one of them MicroStrategy (MSTR 7.35%)It is a business software company that rebranded itself as a Bitcoin development company.

Since 2020, MicroStrategy and its former CEO Michael Saylor have amassed more than 205,000 bitcoins, representing nearly 1% of all bitcoins ever to be created. Sailor is paving the way for a so-called “Bitcoin standard,” citing the weakness of the dollar and the characteristics that make Bitcoin a superior asset.

Although this was scoffed at and cut when the price of Bitcoin plummeted during the cryptocurrency winter, Sailer remained steadfast in his beliefs and accumulation. Today, MicroStrategy currently has $7.8 billion in unrealized profits, and its stock price is up more than 700% over the past year.

Saylor’s embrace of the Bitcoin standard is proving to the world that replacing cash with Bitcoin is an effective strategy to strengthen one’s financial health. With a proven blueprint, it is almost guaranteed that other companies will begin to take notice of how viable the Bitcoin standard is.

Don’t be surprised if some of the more popular companies emerge in the coming bull market, such as: Amazon, Googleor MasterCard — They also announce that they will pursue Bitcoin standards. If one of these big names considers Bitcoin a major component of their balance sheet, the trajectory of the cryptocurrency will change dramatically for the better.

Ultimate achievement is still a possibility

As if the last bull market cycle wasn’t busy enough with companies deciding to buy Bitcoin, we also saw countries deciding to make Bitcoin their fiat currency. In June 2021, the Central American country of El Salvador announced that it would make Bitcoin its official currency. Since the announcement, the country has added nearly 3,000 bitcoins to its treasury.

As part of his Bitcoin-centric plan, President Nayib Bukele launched a bond program leveraging the cryptocurrency, exempted all taxes on Bitcoin, and even launched a mining operation using one of the country’s many volcanoes.

Given El Salvador’s minimal role on the world stage, these decisions have largely gone unnoticed. However, data from the three years since Bitcoin was promoted to fiat currency proves that the results have favored smaller countries.

Although international organizations have warned that the decision to accept Bitcoin would bring economic risks, El Salvador’s economy has reached an annual growth rate of 2% and its Bitcoin holdings are recording unrealized gains of nearly 70%.

do not misunderstand. Bitcoin is not the only reason for El Salvador’s economic development. However, the success since declaring Bitcoin ​​fiat currency and the innovative strategies centered around cryptocurrency are difficult to ignore. In a similar vein to Saylor, El Salvador is proving that there is a different way for countries on the global economic periphery to do things.

But imagine if a country like Russia or Venezuela decided to pursue Bitcoin to evade economic sanctions. Or what about rapidly developing countries like Brazil or Qatar that are trying to solidify their role on the world stage?

If institutional adoption has the potential to change Bitcoin’s trajectory, countries that initiate allocations could send Bitcoin to unimaginable heights. With the cryptocurrency bull market taking shape, it wouldn’t be shocking to see other countries embrace Bitcoin standards and follow in El Salvador’s footsteps.