Grayscale Predicts Positive Boost to Bitcoin Price in 2024 Through Supply Dynamics
Grayscale Investments, in a research report, suggests that Bitcoin's supply dynamics may tighten early next year, coinciding with potential spot Bitcoin ETF approvals, which could positively impact its valuation.
Because Bitcoin
December 1, 2023
Grayscale Investments, in a research report, suggests that Bitcoin's supply dynamics may tighten early next year, coinciding with potential spot Bitcoin ETF approvals, which could positively impact its valuation.
The report notes the relatively tight Bitcoin supply before potential inflows into spot ETFs in the U.S., emphasizing that entities holding Bitcoin may be slow to sell in an appreciating market. Grayscale, among numerous firms seeking SEC approval for a spot Bitcoin product, anticipates a positive effect on valuations due to the combination of inelastic Bitcoin supply and potential new investor inflows.
However, the report highlights risks, including a 'hard landing' for the U.S. economy in 2024, which could impede positive price appreciation for Bitcoin.
Such risks involve a potential resumption of Fed rate increases, fewer-than-expected Fed rate cuts, or a prolonged delay in regulatory approval of a spot Bitcoin ETF for the U.S. market, all of which could significantly hinder the ongoing crypto recovery in the near term, according to Grayscale.
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