Supply and demand dynamics in the Bitcoin market may prevent a supply shock from occurring during the upcoming mining reward halving in 2024, according to Bitvavo CEO Mark Nuvelstijn. Speaking at the European Blockchain Convention in Barcelona, Nuvelstijn discussed the potential impact of market movements on Bitcoin.
Nuvelstijn expressed his belief that exchanges would have enough Bitcoin supply to meet the demand from users. He stated that if there is increased demand for Bitcoin, the price will rise until there is a balance between price and demand. He further added that even if there is a surge in demand, platforms like Bitvavo would still be able to match buy and sell orders and continue facilitating trades.
When discussing Bitcoin exchange-traded fund (ETF) applications in the United States, Nuvelstijn highlighted the increased attention and interest in the crypto market. He cited the recent steep increase in Bitcoin’s price over the past two weeks and suggested that ETF approvals could have a similar impact on the value of Bitcoin.
Bitvavo has observed an increase in web traffic and the number of customers using their platform and app. While these numbers are not yet at the levels seen in 2021, Nuvelstijn sees them as a pre-event before the actual approval of ETFs, which could lead to further growth in the market.
In terms of expansion, Bitvavo is considering entering new markets in France, Spain, and Italy, while still maintaining its focus on the Netherlands and Belgium. Nuvelstijn believes that the European Union’s Markets in Crypto-Assets (MiCA) regulation will drive market maturity and make cross-border business easier for cryptocurrency companies. He anticipates that MiCA will create opportunities for financial services to offer crypto services and for crypto companies to provide financial services.
Moreover, a report by a Standard Chartered analyst in July 2023 predicts that institutional demand for Bitcoin will continue to grow, potentially driving the price of BTC to around $120,000 by the end of the year. The increased profitability of mining could alleviate the need to sell mined coins, further supporting the price prediction.
In conclusion, Nuvelstijn’s insights suggest that the Bitcoin market is expected to handle the upcoming mining reward halving without any supply shocks. The potential approval of Bitcoin ETFs in the US and the implementation of MiCA in the EU are seen as key factors that could impact the market’s growth and mainstream adoption. With increasing institutional demand, Bitcoin’s value may continue to rise, providing opportunities for market participants and investors.