Bitcoin Could Reach $160K in 2024 on the Back of Halving, Spot ETF Hype: Analysts

A slurry of catalysts and historical behavior could catapult bitcoin (BTC) to as high as $160,000 in a widely expected bull market that analysts say could be underway in 2024.

Expected demand for bitcoin from several spot exchange-traded funds (ETF) in the U.S., the upcoming halving and growth in broader stock markets on the back of rates cut could buoy bitcoin prices to at least $50,000 in the short-term, on-chain analysis firm CryptoQuant said in a Wednesday report shared with CoinDesk.

“We argue that bitcoin and crypto markets could have a positive year in 2024 mostly amid the effects from: 1. The market valuation cycle, 2. Network activity, 3. The bitcoin halving, 4. The macroeconomic perspective, 5. Bitcoin spot ETF approval and 6. Growing stablecoin liquidity,” analysts at CryptoQuant said.

“On-chain valuation and network metrics signal bitcoin remains well inside a bull market and may be targeting $54,000 in the medium term and $160,000 as this cycle price top,” they said.

Bitcoin has historically rallied after its halving event – which automatically decreases the supply of new coins in the open market – and traders are likely pricing in the event that’s next scheduled for April 2024.

Meanwhile, over seven major traditional finance players, such as BlackRock (BLK) and VanEck, are in talks with the U.S. Securities and Exchange Commission (SEC) for spot bitcoin ETFs – and a constant back-and-forth is likely signaling the talks are proceeding positively.

Prominent bitcoin holders say the development is likely one of the biggest developments in Wall Street in “30 years.”

“It’s not unreasonable to suggest that this might be the biggest development on Wall Street in 30 years," said Michael Saylor in a CNBC interview on Tuesday, suggesting the last comparable new product was the S&P 500 ETF, which allowed investors one-click exposure to that widely-followed index. Saylor’s business software company MicroStrategy is the largest public holder of bitcoin, with over $8 billion worth of the asset in its treasury.

Traders also expect the U.S. Federal Reserve to lower interest rates in 2024 as inflation has continued to decline – and lower rates have historically been conducive to large bets on riskier assets such as technology stocks and cryptocurrencies.

However, prices could still slide in the short term as recent investors sit on large unrealized gains, CrytpoQuant warned in its report.

“There are some risks of a price correction given that short-term bitcoin holders are experiencing high unrealized profit margins, which historically have preceded price corrections,” the analysts said.

Bitcoin has rallied over 180% on a year-to-date basis – which could create a possible bearish scenario ahead of the New Year.