There is no denying that Bitcoin has had a successful year in 2023. While most are happy that the price is up over 80%, rising from $16k to $30k. The truth is that there is much more to be excited about.
In January, many were declaring that last year with the FTX fraud, the death blow had finally been dealt to Bitcoin and the cryptocurrency market. People were claiming that the price would soon drop below $10k, and that would only be the beginning. Large banks across the US began collapsing and people’s funds began to be frozen. People quickly realized how trapped they are, and the real importance of owning Bitcoin. This helped propel the price of BTC up to $30k, before dropping back down to $25k.
What came next took many people by surprise. Bitcoin, a blockchain where development and innovation had been moving at a snail’s pace, all of a sudden was the developer talk of the town. This was due to Ordianals (NFTs on Bitcoin) and BRC20 tokens being created on Bitcoin. All of a sudden what was thought to be impossible on Bitcoin was becoming possible. In my opinion, the most important aspect of this was that it brought a builder-type of mindset back to Bitcoin. Something that had been sorely lacking during the last handful of years.
But then came multiple quiet months where it seemed like nothing happened. The hype around Bitcoin being a safe-haven asset during the banking crisis and Ordianls began to cool down. What happened next, not even I was predicting. The investment fund behemoth, BlackRock, officially filed for a spot Bitcoin ETF. This resulted in several other companies following suit and doing the same. Just like that the race to get into Bitcoin had begun, and dreams of what the next bull market will look like began popping into everyone’s minds.
With all of that said, we are a society of always thinking ahead, and wondering what is next. Bitcoin has had a great year so far, but what is on the horizon that will propel us even higher in the future?
The Spot Bitcoin ETF
While BlackRock has already applied for the spot Bitcoin ETF, it hasn’t been approved yet. Truthfully there are already several spot ETFs that have been approved around the world, but none of them would be as important as a BlackRock spot ETF. The largest investment fund company, in the largest financial market in the world. This will result in hundreds of billions and even trillions of dollars flooding into the Bitcoin market.
Most people are excited about the “mythical” US Bitcoin spot ETF being approved, but most are underestimating just how much of an impact it will have. Just this development alone could be enough to cause Bitcoin to soar by 10x or more in a short to mid timeframe. All of this means that those predictions of Bitcoin reaching a price of $300k to $500k, might not be so outlandish after all.
The most interesting thing is that the general consensus has shifted that these ETFs will be approved. The only question is when will it happen. It could be 3 months from now, or it could be in January 2024.
The Bitcoin Halving
Aside from the eventual spot ETF being approved in the US, the next sleeping giant on the horizon is the Bitcoin halving that is fast approaching. The halving will occur in approximately April or May of 2024. If you are not aware, the halving cuts in the Bitcoin mining reward issuance each block in half. When Bitcoin was created 50 Bitcoin were mined each block, that was cut in half to 25 in 2012, then 12.5 in 2016, then 6.25, and that will soon be cut in half as well.
The Bitcoin halving is widely considered to be the catalyst that starts each crypto bull market. There is a slight increase in price leading up to the hype of the actual halving taking place. Then after occurring, there are months of quiet where nothing happens. Finally in the fall, about 6 months after the halving, prices begin to soar. During the last cycle, Bitcoin went from nearly $7k, all the way to $69k. Just how high could it go this time?
Beyond
The hard truth is that beyond the spot ETF being approved, or the next Bitcoin halving taking place, there is nothing on the horizon that we currently know about. But that isn’t a reason to worry.
As I mentioned before, no one was predicting the implementation of Ordianals and BRC20 tokens on Bitcoin. It’s likely development here will continue, and even more innovation will happen that we can’t even begin to predict yet. Don’t forget how many developers have come back to Bitcoin.
We are still technically in the bear market, and it’s during the darkest days of crypto winter when all of the building happens. It’s likely that development is currently happening on the Lightning Network, that will bear fruit later. Deeper into the horizon, Bitcoin could see the Taro upgrade implemented into Bitcoin, which would give Lightning a lot more capabilities.
It’s also possible that we could see announcements on the macro or world stage that we weren’t expecting. For example, a few years ago, no one was predicting that El Salvador would be making Bitcoin legal tender in their country. Another key thing to keep an eye on will be how their Bitcoin Volcano bonds turn out. If it is successful, it’s likely other countries will follow suit.
The interesting thing about Bitcoin cycles is that everything comes all at once. During the bear cycle, it seems like nothing is happening. However, during bull cycles, all the news comes at one time. Great days are ahead for Bitcoiners, we just need to be patient long enough to see them happen.
How about you? What do you think is next for Bitcoin?
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As always, thank you for reading!
