According to Fundstrat, a renowned investment research boutique, the price of Bitcoin (BTC) is predicted to surge past $150,000 by the end of 2024. This surge is contingent upon the approval of the current slew of United States spot-Bitcoin exchange-traded funds (ETFs). In an interview with CNBC’s Squawk Box on August 16, Tom Lee, Fundstrat’s managing partner and head of research, explained that a bundle of successful Bitcoin spot ETF applications would significantly influence Bitcoin’s supply-demand dynamics, leading to considerable price appreciation.
When asked about the potential price of Bitcoin by the end of the following year, Lee confidently responded, “If the spot Bitcoin ETF gets approved, I think the demand will be greater than the daily supply of Bitcoin, so the clearing price… is over $150,000, it could even be like $180,000.” However, Lee specified that this scenario would only occur if a United States-approved spot Bitcoin ETF is granted, as there are already spot Bitcoin ETFs available in Europe.
Currently, the United States accounts for 97.7% of the global trading volume for crypto-related ETFs, as stated by Bloomberg senior ETF analyst Eric Balchunas. Once spot Bitcoin ETFs are approved, Balchunas believes this percentage could rise to 99.5%. Therefore, the approval of these ETFs would significantly increase the dominance of the United States in the global market.
Even if the spot ETF applications are rejected, Lee still anticipates a considerable price push resulting from Bitcoin’s next halving event, which is expected to occur in April 2024. This event would create a drop in supply, leading to an increase in the clearing price. However, Lee clarified that the price would not reach six figures.
In recent months, prominent Wall Street players such as Fidelity, Invesco, Wisdom Tree, and Valkyrie have followed the lead of BlackRock, the world’s largest asset manager, by applying for a Bitcoin spot ETF with the Securities and Exchange Commission (SEC). Unfortunately, the fate of some of these applications may not be determined until 2024, as the SEC has 240 days to make a final decision after initiating the review process.
Nevertheless, the outcome of Grayscale’s appeal to convert its GBTC trust product into a Bitcoin spot ETF is expected to be revealed relatively soon. Bloomberg ETF analysts Eric Balchunas and James Seyffart have estimated a 65% chance of these Bitcoin spot ETFs being approved by the securities regulator. This likelihood significantly increased following BlackRock’s application.
On the topic of Bitcoin’s price trajectory, Blockstream CEO Adam Back recently bet that Bitcoin would hit $100,000 the month before the halving event. This suggests that a $100,000 price milestone could be reached more quickly than anticipated. However, not everyone shares this optimistic sentiment. Jesse Myer, co-founder of Bitcoin investment firm Onramp, believes that the market would only adjust to the new reality 12-18 months after the halving.
In conclusion, Fundstrat’s prediction of Bitcoin surpassing $150,000 by the end of 2024 relies on the approval of the current United States spot-Bitcoin ETFs. This approval would significantly impact Bitcoin’s supply-demand dynamics, leading to considerable price appreciation. Additionally, even if these ETF applications are rejected, Bitcoin’s next halving event in April 2024 is expected to cause a price push. The outcome of various ETF applications and the future trajectory of Bitcoin’s price continue to captivate and divide investors and industry experts.