Bitcoin Smashes $40,000 Barrier: What's Next for the Crypto Giant?


Bitcoin Smashes $40,000 Barrier: What's Next for the Crypto Giant?
© Getty Images News/Dan Kitwood

Bitcoin, the foremost cryptocurrency, has achieved a notable milestone by reaching the $40,000 level for the first time since late April 2022. This surge marks a significant uptick in its value, climbing around 2% in just 24 hours.

According to CoinGecko data, Bitcoin moved from under $39,500 to strike above $40,000 on December 3, reaching a 19-month high. This ascent also represents a new year-to-date high for Bitcoin, which has seen an increase of over 140% since January 1.

However, despite this impressive rally, Bitcoin is still down by about 42% from its all-time high of over $69,000 recorded on November 10, 2021. This fluctuation in Bitcoin's value highlights the volatile nature of the cryptocurrency market, where significant gains can be swiftly followed by equally steep declines.

Bullish Predictions and Market Speculations

The recent rise in Bitcoin's value has been accompanied by optimistic forecasts from industry experts. Markus Thielen, head of research at Matrixport, has predicted that Bitcoin could reach over $60,000 by April next year and surge to $125,000 by the end of 2024.

Thielen's analysis is based on the patterns observed in previous crypto bear markets, which were followed by three-year bull cycles. He notes, “Historically, the years when Bitcoin mining rewards were halved were generally bullish”.

Bitcoin's next halving event, where mining rewards are cut by 50%, is anticipated in mid-April 2024. Thielen suggests that miners tend to hoard Bitcoin before each halving, and based on historical trends, this could lead to a price increase of over 200%, potentially pushing Bitcoin to the $125,000 mark.

Another factor contributing to the bullish sentiment is the growing speculation around the approval of a spot Bitcoin exchange-traded fund (ETF) in the United States. Standard Chartered, in a November 28 note, predicted that Bitcoin could reach six figures before the end of next year, partly due to the "earlier-than-expected introduction" of spot ETFs in the U.S.

With 13 bidders for a spot Bitcoin ETF in the U.S., including major players like BlackRock and Grayscale, the crypto community is eagerly awaiting the Securities and Exchange Commission's decision, with Bloomberg ETF analysts assigning high odds of approval by January 10.