What To Watch Out For In Bitcoin and Crypto Markets in the Second Half Of 2024
Bitcoin has climbed this year, rising more than 30%, with demand for ETFs that hold the leading cryptocurrency helping its price upward. But bitcoin prices have recently cooled, pulling back from record highs set earlier this year.
That trend continued Friday, with bitcoin slipping below $57,000 in late-afternoon trading after rising above $73,000 in March. So what’s the outlook for the rest of 2024? Bullish investors say further demand for crypto-focused exchange-traded funds could push prices higher. But other issues loom on the horizon.
Demand related to the spot bitcoin (BTC) exchange-traded funds that began trading in January has supported the cryptocurrency this year. Bulls say that effect hasn’t played out yet.
The new ETFs have recorded net inflows of more than $14.4 billion, according to Farside Investors. Most flows into bitcoin ETFs, which hold the currency, currently come from self-directed investors, and market watchers believe further demand could arrive as financial advisors become less wary of recommending crypto products to clients, boosting bitcoin itself.
«We also don't see many institutions like pensions or endowments involved with the ETFs yet,” said Bloomberg Intelligence analyst James Seyffart. “To me that means there are definitely areas of potential growth in demand.»
Investors broadly expect ETFs based on ether (ETH) to come to market this year: The Securities and Exchange Commission is expected to approve individual ETF applications by the end of the summer. That could boost demand for cryptocurrencies.
Bitwise CIO Matt Hougan estimates inflows of $15 billion into ether ETFs within their first 18 months. Seyffart, meanwhile, expects them to capture 20% to 25% of what the bitcoin funds
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