Bitcoin’s future: Signs of growth

Over the last few weeks, there have been a number of theories circulating from various sources indicating that Bitcoin’s dollar price may increase in the upcoming months.

While there are actually no firm predictions on this, there are three indications that this might also be the trend in the medium run.

The first element influencing Bitcoin’s dollar price is its halving

The expectation for a halving is the first element that drives speculation about a future increase in the price of Bitcoin.

There is one thing that is definite in this situation: halving will take place at block 840,000.

Just over four months from now, in April, block number 840,000 should be mined at the present rate of block mining.

The truth is that, historically, a sizable speculative bubble increased the price of Bitcoin and caused it to reach new all-time highs following the three prior halvings in 2012, 2016, and 2020.

Many people think that the price of bitcoin may rise even after the April halving.

Although there is no guarantee, since halving reduces the amount of new Bitcoin that miners can produce and thus the amount of Bitcoin available on the market, it is nearly a given that the price will rise if demand stays the same or even rises.

The markets may have already priced in this dynamic as well, albeit probably not quite yet.

The year’s end is the second factor

The price of Bitcoin typically reaches its yearly highs or lows at the end of the year for solely financial reasons.

Profit-making individuals in particular can think about delaying sales by a few weeks in order to advance the payment of taxes on any capital gains by a year.

In the event that the price of Bitcoin is high, this tends to decrease sales as the end of the year draws near.

While it was only $16,500 in the beginning of 2023, the price has undoubtedly increased since then.

As early as January, it began to rise back above $20,000, and starting in March, it started a protracted lateralization above $25,000.

But it began to rise beyond $35,000 in late October, maybe as a result of the year’s finish drawing near. Ever since, it has been lateralizing in that region, or getting closer to the yearly highs reached a few days ago.

Even if it is currently 47% below the all-time highs reached in late 2021, it has already increased by +124% since the year’s beginning.

It’s probable that many present Bitcoin holders are making money and are delaying selling until the end of 2023 in order to defer paying taxes on any earnings by a year, considering that many may have sold during the major bear market of last year, maybe at a loss.

ETFs are the third factor.

Still, the most important factor at the moment probably has to do with the US government’s acceptance of spot Bitcoin ETFs.

It is anticipated that such permission will not occur until late December or early January, despite the fact that many now view it as practically inevitable.

Notably, because BlackRock has a history of over 99% approval rate for such ETFs, the price of Bitcoin shot up from $25,000 to $30,000 in a matter of days when it was revealed in June that the company had submitted such an application to the SEC.

The price had already risen by late August, when news broke that Grayscale had won its lawsuit against the SEC over the rejection of its application to issue an ETF on spot Bitcoin. It’s possible that the excitement surrounding the expected approval of ETFs also contributed to the small bullrun in late October.

To be honest, though, a lot of analysts contend that this third factor’s momentum might not have peaked yet.

All three criteria are, in fact, still in place; only the first is still a ways off from materializing, and the second is about to expire in a little over a month.

Rather of waiting for approval, ETFs are driving up the price of Bitcoin and, if they do well in the market, may continue to do so long after.

Forecasts for the dollar value of bitcoin

These factors lead many observers to contend that Bitcoin’s price increase is still ongoing.

The critical threshold for the near future is $38,000, which so far acts as a kind of wall that has already thwarted two previous attacks.

Some analysts even predict that this wall may collapse by year’s end, which may lead to Bitcoin hitting $40,000 as early as late November.

By December or January of that year, the price of Bitcoin might have risen above $45,000 once more.

It should be noted that the circumstances of late 2023 are similar to those of late 2020, when the increase continued until mid-January 2021. However, if prices keep rising, people who don’t sell in November and December are unlikely to do so in January. However, they sell as soon as it becomes evident that the upward run is over.

It is assumed, therefore, that there might be an additional increase up to the $50,000 mark prior to the halves.

Despite being mere conjectures rather than absolutes, these assumptions are supported by historical behavior. Granitic strength from the past provides a solid foundation, but it cannot ensure that projections made in the future will be accurate.

By the end of November, we might likely already know if this dynamic is in place or not, particularly if the $40,000 threshold is not crossed. In that case, we would be assured that this dynamic is not in place.