As BTC breaks above $40k, Bitget looks at why 2023 was good and 2024 could be great

There was at least one major reason for the crypto market’s notable shift into positive territory this year, notes Bitget. See if you can guess what it was/is…
The exchange sees a big year ahead for the market, with six further catalysts to come

Special Report: Bitget, one of the world’s leading crypto exchanges, identifies what’s made 2023 a much better year for the market, as well as trend shifts that could send it all to the moon in 2024.

Don’t know if you’ve noticed, but the crypto market, led by Bitcoin and Ethereum and other top majors, has proven to be remarkably resilient this year – certainly after a very miserable bear-dominated 2022.

And we type this as Bitcoin (BTC) – the market’s general barometer for health – pokes its head north of US$40k for the first time in about 19 long months.

So, what then was the big market-moving narrative that helped pull BTC from about US$16k in January 2022 to where it is today, and helped inject more than US$650 billion back into the entire crypto market cap?

And what, too, should we be keeping our eyes on regarding trend shifts that could spur on the crypto market in 2024?

We think you might know the first part…

The Bitcoin ETF narrative

“The concentrated application for a Bitcoin ETF led by BlackRock is the most significant narrative of 2023,” noted Bitget’s MD Gracy Chen in an email forwarded to Stockhead by her team.

If you’ve only been keeping half an eye on crypto, you’ll know that the world’s biggest asset manager (among several other huge players including Fidelity, VanEck, Ark Invest and more) is gunning for the first ever spot Bitcoin ETF in the US.

And there seems to be genuine belief at last that one, or several all at once, could get over the line past SEC Chair Gensler’s last, desperate lunging tackle.

Why is it so coveted? A few reasons, including…

“Spot Bitcoin ETFs can reduce investment costs, increase liquidity, improve price tracking efficiency, and meet stricter regulatory requirements, expanding the accessibility and acceptance of Bitcoin,” said Chen.

“Especially for retail and institutional investors, spot Bitcoin ETFs provide a more convenient and direct investment channel.”

Like many others in the space believe, Bitget expects that a BTC ETF in the US will bring “an influx of substantial new funds” into the crypto market, which would likely boost the total market value of the crypto world.

“With such expectations, the confidence of both institutions and retail investors has been greatly strengthened,” added Chen.

Oh, there was the Ripple win, too

Bitget also highlights the Ripple firm’s long-winded courtroom drama victory over the SEC in the latter stages of this year.

A US federal judge has ruled that Ripple’s sales of XRP tokens through exchanges and algorithmic programs do not constitute investment contracts and are therefore not in violation of the securities laws that Gensler and some of his offsiders have been attempting to pin on the Ripple crypto company.

“Subsequently, the SEC’s lawsuit against Ripple’s CEO [Brad Garlinghouse] failed,” added Bitget, “leading the market to believe that the regulatory environment is improving. This has created a high probability expectation that Bitcoin ETFs will be approved.”

Six more reasons to back crypto in 2024

In addition to the strong possibility of Bitcoin ETF approvals in the US next year, which many pundits expect as early as January, Bitget has identified six other catalysts for positive developments in the global crypto space.

Ethereum ETF approval – The exchange notes that this, too, is highly anticipated off the back of likely Bitcoin ETF approvals.

Ethereum upgrades – “The Ethereum Cancun upgrade is scheduled for the first quarter,” Bitget reminds us, “during which Ethereum and L2 ecosystems will further unleash their potential. Also, ZK L2 projects are expected to experience a token issuance boom.”

Circle’s IPO – The issuer of stablecoin USDC, Circle, is preparing for its initial public offering (IPO), which could potentially take place in Q1 2024. “This move is expected to support the adoption of cryptographic stablecoins,” wrote the exchange.

The ‘halving’ – This one, for many in crypto is huge. Bitcoin will undergo its once-in-four-years halving in just 155 days, which effectively “increases the scarcity of Bitcoin”, says Bitget. The baked-in process achieves this by cutting in half the rate at which new BTC are released into circulation. Satoshi Nakamoto… whoever you are or were, you’re a bona fide genius.

FTX drama winding up – The FTX case is, at long last, entering its latter stages, notes Bitget, and is facing restructuring. “As regulatory clarity emerges, it is expected to attract new retail funds.” And that would be a head-shakingly amazing turn of events, given everything we know that transpired with the company’s founder Sam Bankman-Fried.

The Fed’s rate hiking is ending – Markets are anticipating interest rate cuts in the US as early as May 2024, noted Bitget: “Under this impetus, positive sentiments in cryptocurrency markets are expected to strengthen, enhancing the appeal of Bitcoin.”

Any remaining headwinds?

There are still some floating around, sure.

For example, Bitget boss Gracy Chen notes the likelihood of “liquidation of the Bitcoin overhang from Mt. Gox” – a Bitcoin exchange from 2010-2014 that suffered one of the very worst hacks in crypto’s history.

She also mentions the US government’s Silk Road seizure of Bitcoin – at one stage it was said to be holding US$5.5 billion worth of BTC – for which concerns have been raised regarding a possible market-dumping event.

These things aside and passed, however, Chen and Bitget are of the belief that next year “a true bull market will emerge, accompanied by widespread adoption of cryptocurrencies and new innovations”.

This article was developed in collaboration with Bitget, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.