In recent years, Bitcoin has become a popular topic of discussion in the financial world. But in 2024, like no other year before, it is important to consider what we can expect from this digital currency, although we are already on track to finish the first quarter of the year.
Three months before the halving
One of the key factors that will likely affect the future of Bitcoin is its adoption and acceptance by major institutions. While Bitcoin was once considered a fringe asset, it has increasingly gained acceptance by financial institutions and traditional investors. The irrefutable proof of this is the entry of Wall Street with ETFs, although many deny it.
Now, regardless of whether we give a positive or negative reading to the ETFs (and I don't particularly give a very positive reading to that matter), we must recognize that this puts Bitcoin on the table of large investors and injects more and more capital into it, which means greater liquidity. With large financial groups like GrayScale buying the largest amount of BTC possible in the shortest possible time, it is opening the way to a greater shortage of the crypto asset, which by the law of supply and demand we already know what it will trigger. Exactly, this will trigger the fact that Bitcoin will increase considerably in price in 2024.
Because also, to contribute to the scarcity factor, we all know that 2024 is the year of the halving. In fact, we are only three months away from the aforementioned event, which will end up driving (sooner or later) the price of BTC to the heights.
Other facts to consider regarding the present and future of BTC
As a result of all of the above, we can expect to see continued interest and investment in Bitcoin by entities and individuals from 2024 onwards. But, in fact, we all know that those who have the greatest weight in the market at the price level are the large investors, that is, the large entities and governments, since they have enormous financial capitals to invest.
At the level of individual investors, there are also many cases of people who have a considerable influence on the crypto market, but they are what we call "whales" and there are not too many of them. Especially if we compare them with the majority of retail investors on the market.
Furthermore, another factor that is playing a major role in shaping the future of Bitcoin is regulatory developments. For as governments around the world grapple with how to regulate digital currencies, we see continued efforts to bring clarity and legitimacy to the space. This undoubtedly results in increased regulation of Bitcoin, affecting its value and adoption.
We could see all this matter as a negative thing, however, in all of this we must consider that if regulators are able to strike a balance between protecting consumers and encouraging innovation, this could lead to a more stable and sustainable future for Bitcoin. But, in addition to regulatory advances, technological advances are also a key factor, driving the evolution of Bitcoin now and in the future. Since as Bitcoin's underlying technology, the blockchain, continues to mature, we can expect to see improvements in scalability, security and privacy.
And all of these advancements will help overcome some of Bitcoin's current limitations, such as slow transaction speeds and high fees, making it more attractive for everyday use. We are talking here about second layer solutions, but also about issues such as the first ICO within the Bitcoin blockchain, which, by the way, is currently in the news.
Use cases and applications
In addition to all of the above, as Bitcoin becomes more mainstream, we can expect to see an increase in use cases and applications. In fact, we are seeing more and more businesses accepting Bitcoin as a form of payment, and this trend is likely to continue in the coming years.
Because of this, as more people become familiar with digital currencies, we can expect to also see new financial products and services emerging built on the Bitcoin blockchain. This could include things like decentralized finance (DeFi) platforms, lending and debt services, and more.
And as I have mentioned many times in previous posts, the scarcity and limited supply of Bitcoin will continue to be a key factor in its value proposition. Since with only 21 million Bitcoins as the maximum available capacity, the supply is fixed, meaning that as demand for Bitcoin increases, its price is likely to follow the same path. And those who doubt this, think again, because this scarcity factor has helped drive Bitcoin's value in recent years and is expected to remain a key driver of its value in 2024 and beyond. Supply and demand, friends, it's all about that.
In end, there are many factors in an effort to determine the future of Bitcoin and I really consider that 2024 is being a essential 12 months in this regard, and that the coming years may be increasingly important as well. From regulatory tendencies to technological advances and more adoption, there are many motives to be optimistic about the destiny of this virtual foreign money. For while there are really dangers and hard situations now, it's far clean that Bitcoin has the potential to revolutionize the manner we see and drive on cash and finance. So it'll be exciting to see how Bitcoin continues to evolve and grow now and in the destiny.
What do you think about the topic discussed? Please comment.
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This has encouraged me to put my eyes on the crypto space as soon as possible. Although I have few coins but haven't had the time to check the market flows for a while now.