It may seem like bitcoin has hit a roadblock after hitting $52,000, but the recent downturn is expected to be short-lived. Matrixport's latest report suggests that bitcoin's goal of reaching $63,000 by March 2024 remains feasible.
Catalysts supporting this projection include the approval of a bitcoin spot ETF, the upcoming bitcoin halving, expectations of an interest rate cut following the Federal Reserve's FOMC meeting, and the presidential election. from USA
Driving bitcoin's March 2024 Target
Following the SEC's approval of bitcoin spot ETFs on January 10, there has been growing demand for these offerings. Over the past week, bitcoin spot ETFs have seen steady increases in funds, outperforming all other exchange-traded products (ETPs) among the 3,400 available for trading in the United States.
Recent statistics indicate that these ETFs have seen positive net inflows exceeding $2.2 billion for the second consecutive week, February 12-16.
Most of the funds flowed into BlackRock's IBIT ETF, which amassed $1.6 billion. Fidelity's FBTC followed with the second-largest inflow, raising $648.5 million last week. During the same period, Ark Invest/21Shares' ARKB and Bitwise's BITB earned $405 million and $232.1 million, respectively.
The report also notes that anticipations of interest rate cuts following the Federal Reserve's Federal Open Market Committee (FOMC) meetings could influence preferences toward riskier assets like bitcoin. Lower interest rates generally decrease the attractiveness of investments that generate returns, thereby increasing the attractiveness of growth-oriented assets.
homeport emphasized that the upcoming US presidential election and political uncertainties could also influence bitcoin prices. Historically, during such periods, investors have often turned to alternative assets like bitcoin as a hedge against potential changes in economic policies.
However, predicting the exact impact of these political events on crypto markets is challenging due to their complexity.
Meanwhile, former US President Donald Trump, who is currently leading the race for the Republican Party presidential nomination, has changed his stance on bitcoin. Despite having made negative comments about the leading crypto asset and labeling it a scam during his presidency, Trump is now signaling his willingness to accept bitcoin while acknowledging the growing demand for it.
More demand for bitcoin
In a statement about CryptoPotatoJag Kooner, head of derivatives at Bitfinex, predicted that 2024 will be a favorable year for safe-haven assets such as bitcoin, gold and silver. Continued high inflation rates, which exceed the preferred thresholds of central banks globally, are expected to prolong higher interest rates.
This outlook is intended to temper prevailing market expectations of an early easing of monetary policy in developed markets, which could cause disappointment among investors.
“Looking ahead to 2024, the outlook for stock markets looks more challenging. Factors such as modest earnings growth and various geopolitical risks are expected to put downward pressure on stock markets. Some research suggests modest earnings growth for the S&P 500, in the range of 2-3% and a target of 4,200 for the index, with a downward bias. “This aligns with our view and we believe it will result in increased demand for commodities and bitcoin.”
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