Bitcoin, the original cryptocurrency that stands as a blueprint for all the altcoins that followed it, is one of the most popular assets in the world. Many investors add it to their portfolios as a means to diversify their list of holdings and ensure their capital gets away with minimal damage during times of heightened inflation. However, the market hasn’t been doing so well over the past year. Bitcoin was hit by successive events that impacted its prices. In 2022, values plummeted to very low levels, and while recovery followed in 2024, it wasn’t as extensive as some investors were expecting, especially as regulatory pressures continued to mount.
Although engagement has remained more or less constant, with users continuing to buy Bitcoin with debit cards, they are convinced the crypto will ultimately recover. Now it may seem like that elusive future is becoming increasingly more probable.
A possible rally
In 2022, Bitcoin lost over 60% of its value. 2021 was arguably the best year in the coin’s history, as it reached higher levels than ever before. This has only made its subsequent fall all the more hurtful for investors. When 2024 started, many expected prices to steadily climb back up over the course of the first few months. This is despite warnings from analysts that such growth would most likely be unsustainable in the long run.
Yet, this scenario hasn’t come to pass, and what happened was that BTC recorded steady growth, and then the prices began to stagnate. The bullish market that many had predicted didn’t come to pass, and bearish movements remained the rule of the day. However, based on an analysis conducted on June 8th, things might soon start looking up for Bitcoin.
The encouraging signs come after a period of considerable uncertainty, as regulation efforts in the US targeted influential crypto exchanges. While the bill currently proposed, which would split digital assets between commodities and securities so they’re easier to manage, has received a generally warm welcome from investors, increasing talk of legislation has reduced liquidity, making the already shaky market even more volatile.
Now, investors believe that Bitcoin might record a 60% growth, but only if long-term chart patterns remain the same. Currently, BTC is still within the same trading range where it has spent the past three months. Since the position has been relatively narrow, users aren’t exactly sure what to expect in terms of short-term price changes. As such, they had to adjust their strategies and wait for things to change.
The fact that Bitcoin could sprint to $40,000 seems more like wishful thinking than an actual, realistic prediction. But there’s more to it than meets the eye. Higher time frames can indicate that substantial price action is just around the corner. Others believe that the current trend falls under the umbrella of the inverse head and shoulders pattern.
Others believe that the $40k milestone isn’t on the cards for 2024 but that investors can anticipate it for the following year. With the halving in April 2024, the BTC price could swing between $20,000 and $40,000 for approximately twelve months, which will be an auspicious time to accumulate coins. The halving could also bring a bull run that might take Bitcoin to previously unseen prince points of up to $100k.
Trading increase
The increasing push for regulations, as well as the possible extra taxes placed on mining activity, haven’t deterred users from interacting with the market. On the contrary, it seems to have made trading even more attractive. The 9th of June recorded an increase in trading, as many customers scurried to look for ways to keep their capital safe.
Some of the assets directly targeted by the new legislation have recorded slight discounts on their platforms due to investors looking to sell. This has occurred as a result of the news that withdrawals in US dollars could be stopped. As of June 13th, fiat withdrawals are expected to be paused by the banking partners working alongside the exchanges. Investors have been warned to take the necessary precautions.
Reclaiming the used capital should be performed using bank transfers, as dollar-denominated pairs will be delisted from the middle of June.
Supply shares
Asia will likely become the most popular place for cryptocurrencies, as research shows that the supply share in the United States has begun to dwindle. The past year has come with increasing shifts in the world of cryptocurrency. This should come as no surprise, especially considering the fact that the global economy has navigated the muddy waters of high inflation and elevated interest rates for a while now. Recently, the threat of the United States defaulting on its debts kept the global community on its toes, afraid of the possibility of a recession.
Data shows that since the middle of 2022, the supply that’s either held or traded by US entities, whether individual or organizational, has decreased by over 10%. This comes in stark contrast with the US market dominance within the niche between 2020 and 2021.
European markets have remained more or less neutral, with the supply not showing a marked decrease like in the US, but not significantly increasing either. A large part of the supply seems to have moved towards Asia, as the continent has adopted a more permissive attitude when it comes to digital assets. This might soon mean the continent will quickly become the global leader in digital finance innovations.
The bottom line
Cryptocurrencies are going through a rather challenging period at the moment, but this isn’t the first time the market has had to face considerable challenges. Each time, Bitcoin came through more powerful than before, and many believe this will also be the case this time.
Many investors have been critical of the increasing push for regulations, believing it to be proof of an attempt to stifle and control the market rather than help it develop and provide a safer trading environment for investors. Instead, they advocate for the adoption of comprehensive legislation that helps foster innovation and supports sustainable growth.
