Cryptocurrency service provider Matrixport’s analyst Markus Thielen stated in a report released on Thursday (14th) that even if the Bitcoin spot ETF does not receive approval from the U.S. Securities and Exchange Commission (SEC) in January 2024, we may still see higher cryptocurrency market prices next year.
Thielen mentioned several factors, including increased liquidity, the Bitcoin halving event, and the possibility of Donald Trump being re-elected as U.S. President, which could serve as catalysts for further price increases.
Since the outbreak of the COVID-19 pandemic, the amount of funds in the U.S. money market funds has increased from $3 trillion to $6.1 trillion, indicating an annual interest payment of around $370 billion, equivalent to approximately $1 billion per day. Thielen believes that these funds will “easily” flow into riskier investments such as stocks and cryptocurrencies. Additionally, Thielen believes that this $6.1 trillion capital could also be used to boost asset prices.
2024 is the year of the Bitcoin halving, when block rewards will be halved from 6.25 BTC to 3.125 BTC. Thielen pointed out that Bitcoin prices have typically risen by an average of 192% during halving years.
Impact of the U.S. Presidential Election
The analyst also mentioned that 2024 is a U.S. Presidential election year, and Trump is “highly likely” to be re-elected, with his policies potentially boosting the U.S. economy, stock market, and cryptocurrency prices.
Thielen noted that while a Republican president could regain control of the White House, Democratic SEC Chairman Gary Gensler may continue in office until his term expires in June 2026. Thielen expects that by then, a Bitcoin spot ETF will be approved, but he added that Trump, who has introduced his own NFT series, is likely to support another measure that would solidify digital assets as an economic cornerstone.
However, Thielen predicts that Bitcoin prices will remain in the range of $40,000 to $45,000 for the remaining weeks of 2023, and then attempt a rebound in January next year as traders focus on the potential approval date of the Bitcoin spot ETF.
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