The price of Bitcoin could surge past $150,000 by the end of 2024 if the Securities and Exchange Commission (SEC) approves a slew of spot Bitcoin exchange-traded funds (ETFs), according to investment research boutique Fundstrat.
In an interview on CNBC's Squawk Box on August 16, Fundstrat's managing partner and head of research, Tom Lee, said that a successful approval of Bitcoin spot ETFs would shift Bitcoin's supply-demand dynamics towards considerable price appreciation.
"If the spot Bitcoin (ETF) gets approved, I think the demand will be greater than the daily supply of Bitcoin, so the clearing price is over $150,000, it could even be like $180,000," Lee said.
Lee clarified that this could only be the case if the ETFs are approved in the United States, as there are already spot Bitcoin ETFs in Europe. The United States currently makes up 97.7% of the global trading volume for crypto-related ETFs, according to Bloomberg senior ETF analyst Eric Balchunas. Once spot Bitcoin ETFs are approved in the US, this could go to 99.5%, he said.
Even if the spot ETF applications are rejected, Lee still predicts a considerable price push to come from Bitcoin's next halving event, expected to take place in April 2024.
A halving event occurs every four years when the reward for mining a block of Bitcoin is cut in half. This reduces the supply of Bitcoin in circulation, which can lead to price increases.
In June, Wall Street heavyweights Fidelity, Invesco, Wisdom Tree and Valkyrie followed the world's largest asset manager BlackRock in applying for a Bitcoin spot ETF with the SEC. However, some of these firms may not learn their fate until sometime in 2024 as the SEC has up to 240 days to make a final decision on an application after commencing the review process.
The outcome of Grayscale's appeal to convert its GBTC trust product into a Bitcoin spot ETF is however expected to come sooner rather than later.
Bloomberg ETF analysts Eric Balchunas and James Seyffart recently estimated that there's a 65% chance of these Bitcoin spot ETFs being approved by the securities regulator — a significant increase from before BlackRock's application.
Other analysts have tipped that a $100,000 Bitcoin price could come much sooner than expected. Blockstream CEO Adam Back recently wagered that Bitcoin will notch the new price milestone the month before the halving event.
However, not everyone is inclined to agree. Jesse Myer, the co-founder of Bitcoin investment firm Onramp, explained on August 15 that the market would only price in the changed reality 12-18 months post-halving.
"Bitcoin won't surge to $100k before the next halving," he said.
Only time will tell what the future holds for Bitcoin, but one thing is for sure: the cryptocurrency is one of the most volatile assets in the world, and its price is subject to wild swings. Investors should do their own research before making any investment decisions.
Do you think Bitcoin will reach $150,000 by the end of 2024? Let me know your thoughts in the comments below
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