In a recent development, Blockstream CEO Adam Back anticipates a bullish resurgence for Bitcoin in 2024, projecting a potential surge to $100,000. Back attributes Bitcoin’s recent value decline, dropping to $42,882 over the past two years, to a series of impactful events such as the COVID-19 pandemic, inflation, and regional conflicts.
Describing the past years as akin to “biblical pestilence and plague,” Back points to factors like COVID-19, quantitative easing, and geopolitical tensions affecting power prices as contributors to Bitcoin’s market challenges. He highlights how market disruptions forced investment managers to liquidate assets, impacting portfolio management.
As 2023 concludes, Back notes the resolution of macro events and industry-specific failures, leading to a recent uptick in Bitcoin’s price. He emphasizes that issues involving companies like Three Arrows Capital, Celsius, BlockFi, and FTX have largely subsided, reducing the likelihood of major surprises.
Back had previously predicted Bitcoin reaching $100,000 in the next market cycle, suggesting that macro factors held back its attainment. Referring to the “stock-to-flow” model by PlanB, he underscores the potential upside for Bitcoin in 2024, with historical trends indicating surges in price following halving events.
Another factor contributing to the optimistic outlook is the potential approval of spot Bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC). Notable analysts like Eric Balchunas, James Seyffart, and Michael Novogratz anticipate approval in early 2024. Back concurs, emphasizing the ETF’s significance in attracting institutional investment.
The Bitcoin advocate highlights that traditional market segments, including major fund managers like BlackRock and Fidelity, face restrictions on direct Bitcoin investments. He sees the approval of a spot Bitcoin ETF as a catalyst for substantial capital inflows, providing avenues for broader fund participation, especially in the U.S., through established entities like Fidelity or BlackRock rather than cryptocurrency exchanges.