Bitcoin rose to the highest level in 19 months on Sunday as traders are enjoying potential interest rate cuts in 2024 and also speculating the likelihood of an approval by regulators for U.S.-stock market traded bitcoin funds.
The world’s biggest cryptocurrency rose as high as $40,210 on Sunday, the highest level since April 2022 and also the first time that it broke $40,000 level. The price continued to rise above $41,000 on Monday.
Several experts said in an interview with CNBC that 2023 is the year that Bitcoin is preparing for a bull run as sentiment is hopeful for 2024 and 2025. Bitcoin has risen 150% so far this year. Moreover, historical data indicates that Bitcoin usually went on a bull run after halving, which is scheduled for May 2024.
Standard Chartered last week reiterated an April target that bitcoin would hit $100,000 by the end of 2024 with a boost from the approvals of numerous exchange-traded funds (ETFs). The U.S. Securities and Exchange Commission met with Grayscale and BlackRock late November to discuss the Funds that traders are speculating that approvals could be as soon as early next year.
Meanwhile, markets anticipated that the US Federal Reserve had ended its rate-hike run. It is expected that there could be 125 basis points of rate cuts by the end of next year for the US central bank and five cuts by the European Central Bank in the upcoming year, with the first cut set for March.
Cryptocurrency saw its heyday in 2021 as Bitcoin hit a record $69,000 in November that year. But as central banks began to raise interest rates in early 2022 to fight inflation. Risk assets like stocks and even riskier assets such as cryptocurrencies began to collapse as investors look for better returns.
Still, some experts also said that despite the potential bull run next year with the approval of ETFs, it could fail miserably if regulators reject it.
