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In 2024, Bitcoin is expected to experience three significant positive factors: halving, the rise of the Bitcoin ecosystem, and expectations of a Fed interest rate cut.
1) Bitcoin's miner reward undergoes halving approximately every four years, and during the six months following the past three halvings, the Bitcoin price has shown significant growth. The fourth halving is expected in April this year.
2) Since the introduction of Ordinals, a Bitcoin-based digital content encoding method, in December 2022, the Ordinals user base has surged. Numerous new and existing protocols on the blockchain have driven the robust development of the Bitcoin ecosystem, leading to Bitcoin's on-chain transaction fees surpassing Ethereum for the first time in six years.
3) According to Federal Reserve Board members' forecasts, the real GDP growth rate in the United States for 2024 is estimated to be 1.4%, and the federal funds rate is expected to be 4.6% (compared to 5.4% in 2023). A potential interest rate cut may lead to an increase in the supply of the US dollar and its devaluation, potentially driving more demand for Bitcoin due to its inflation-resistant properties. The approval of a Bitcoin spot ETF also affects the stock prices of relevant overseas-listed companies, primarily mining companies, trading platforms, and holding companies. The business model of mining companies can be summarized as "early investment - later harvest." As the Bitcoin ecosystem matures and trading volumes increase, the early investment gradually dilutes, and later returns may become more stable. Trading platforms generate revenue from transaction commissions, exhibiting characteristics of "water sellers." Leading platforms establish competitive barriers through economies of scale. Holding companies acquire large amounts of Bitcoin at relatively low costs in the early stages and enjoy capital gains. |
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Post time 6-2-2024 11:51:13