The price of Bitcoin has surged back above $51,000, reconnecting with its all-time high from 2021. Key factors driving this latest bull run include the approval of a spot Bitcoin ETF in Canada, increasing institutional adoption and the upcoming Bitcoin halving in 2024.
Why Is Bitcoin Surging Again?
In November 2022, Canada approved the launch of the Purpose Bitcoin ETF, opening the doors for direct cryptocurrency exposure for investors in the country. This long-awaited spot Bitcoin ETF is expected to trigger even more institutional investment into the cryptocurrency markets.
The U.S. has also taken a step closer towards a spot Bitcoin ETF with the appointment of crypto-friendly officials at the Securities and Exchange Commission. And with major financial institutions like Visa, Mastercard, and BNY Mellon embracing crypto, credibility around Bitcoin continues to grow.
But when you look ahead, the 2024 Bitcoin halving is emerging as the standout factor heating up speculative fervor.
Countdown to the 2024 Bitcoin Halving
The Bitcoin halving is one of the most anticipated events in the cryptocurrency calendar. It occurs roughly every 4 years and leads to a 50% reduction in the mining rewards per block. Each halving constrains Bitcoin's already limited supply, acting as built-in scarcity.
With the next halving expected in early 2024, investors are piling in ahead of the cut in supply. FOMO is kicking in thanks to the last halving in 2020, which catalyzed Bitcoin's bull run to its previous all-time high.
The 2024 halving will see the block reward fall from 6.25 BTC to 3.125 BTC. If history repeats, the ensuing supply shock could power Bitcoin upwards to new record highs.
Growing Mainstream & Institutional Adoption
While the 2024 halving may be priced in to an extent, real-world Bitcoin usage continues to gain traction. This is providing tangible validation of its staying power for both retail and institutional investors.
For example, Visa and Mastercard have been actively integrating cryptocurrency capabilities. PayPal enables US consumers to check out with Bitcoin across millions of merchant outlets. Tesla famously invested $1.5 billion into Bitcoin, with the EV maker resuming purchases using the cryptocurrency.
Major Wall Street institutions like Fidelity have also launched crypto arms amid surging demand from wealthy clients. And Bitcoin has proven itself as an inflation hedge in the eyes of publicly-listed companies adding it to their balance sheets.
This embracing of Bitcoin by corporate America is rapidly legitimizing it as an investable asset class rather than just a speculative vehicle.
Key Takeaways
- Bitcoin has reconnected with $51K, close to its former all-time high
- Approval of Canada's first spot Bitcoin ETF is driving more institutional investment
- The 2024 Bitcoin halving will see block rewards cut by 50% to 3.125 BTC
- Growing real-world adoption from the likes Visa, Mastercard and Tesla adds credibility
- More firms using Bitcoin as an inflation hedge proves its resilient value
With greater transparency, regulation and access through investment vehicles like ETFs, Bitcoin is increasingly proving itself as 'digital gold 2.0’. And with the next halving countdown underway, more price discovery appears inevitable.
But with so many bullish indicators lining up, is mainstream adoption raising stability risks from older coins concentrated in few hands?