Bitcoin, the gold among cryptocurrencies, has had a rollercoaster ride in the first six months of 2024.
It has been a hot topic in the presidential election campaign of the U.S. and its phenomenal adoption into the mainstream has forced several countries to bring up regulations.
Bitcoin has also witnessed landmark events such as Halving 2024 and the launch of spot Exchange Traded Funds (ETFs) propelling BTC’s value to newer heights.
Once valued next to nothing, Bitcoin has seen a meteoric rise in the past decade and a half and this year was no exception as the BTC cryptocurrency reached a record high of $73,700. The cryptocurrency has long been the primary choice among digital assets for investments and market experts have also predicted that Bitcoin will break the $100,000 barrier in the current bull run of 2024.
In this 360-degree overview article, we will analyze the performance of BTC in the past six months, the various factors responsible for BTC’s trajectory and its future.
Bitcoin Price Traction 2024
Mirroring the high performance of stock markets across major economies, Bitcoin has ridden the wave of bullish momentum well to emerge as a trendsetter in 2024, just like it did in the post-covid era of 2021.
At the very beginning of the year, BTC price stood at a high of $42,280 in its reclaiming period after dumping to as low as $15,880 in November 2022. This dump, before the correction occurred after BTC, reached to a new high above $65,000 in the 2021 Bullrun.
According to data from TradingView, the market opened on Monday with BTC priced at $63,347, at the time of publishing of this report. After reaching a new all-time high of $73,794 on 14th March, BTC has been trading within the range of $60,400 to $71,700 amid massive volatility compared to past years.
The current major support for BTC price is at $60,400 and resistance near $71,700 which it tried to break in four tries since April. However, the upper side selling pressure is heavily contributing to the uptrend rejection and it has been moving sideway since months now.
Most of the BTC price action this year has been fueled by several economic factors including approval and trading of spot Bitcoin ETFs, the recent fourth Bitcoin Halving, and most importantly – the hype around bullrun. All the news around these trends have set a major ground for Bitcoin price to grow exponentially in recent times.
Let’s look at all the key-factors that had a significant impact on BTC price in the first half of 2024.
Key Factors Affecting BTC Price in H1 2024
Spot Bitcoin ETFs
The approval of spot Bitcoin ETFs in the US in 2024 will be remembered as a milestone in the history of Bitcoin. Since its approval on 10 January this year, ETFs have been influencing BTC’s price notably with its trading volume closely competing against BTC’s overall trading on crypto exchanges.
According to data from Sosovalue, spot Bitcoin ETFs have accumulated a total inflow of $56.41 billion till date. This inflow, from traditional finance into Bitcoin, has also been subject to market trends which saw huge increases and decreases over time.
Bitcoin Halving 2024
Halving is considered the most bullish catalyst for Bitcoin and it has been proven in the past. Generally, BTC price takes a leap of uptrend in the following months of Halving. Over the past 3 halving events, BTC price recorded spikes of 30,000%, 786%, and 720% respectively in 2012, 2016, and 2020.
The fresh uptrend followed by the recent halving of 2024 was much anticipated to drive BTC to record highs. Several analysts predicted that Bitcoin will reach above $100,000 in 2024 and 2025. However, the reversed market dynamics have caused a failed sustained rally in BTC price. It was also for the first time that BTC price broke to a new all-time high before halving in 2024.
Although it’s been hardly three months post halving and the BTC price usually tends to spike after 8 or 9 months of halving, therefore it would be premature to say that BTC has reached its full potential yet.
Bullrun 2024
Another key factor is the so-called price uptrend which revises every four years. These cyclic gains have occurred in the following months of Bitcoin halving and usually within this period, the whole crypto market witnesses a wave of adoption and a sharp increase in market price alongside Bitcoin.
For the bullrun of 2024, market speculators have expected “never-seen-before” inflows from retail investors and traditional finance players because of the involvement of crypto ETFs. The existing spot Bitcoin ETFs and recently apprised spot Ethereum ETFs are expected to attract billions of dollars from investors. Whether or not, this bullrun is expected to onboard millions of users to crypto and it will possibly peak at the end of 2024 or the beginning of 2025.
Bitcoin: A blooming ecosystem
Apart from this, Bitcoin has also seen significant developments in its ecosystem. The introduction of smart contracts, layer 2 networks, and inscriptions on Bitcoin have pushed it to become more than just a blockchain for transferring values.
On Monday, the new BTC addresses surged to a record high of 352,124 since April this year thereby signifying a gain of trust in the retail investors.
Let’s have a look at some of these recent developments that are positioning Bitcoin ahead of Ethereum, Solana and other blockchain networks in the DeFi ecosystem.
Recent Developments within Bitcoin Ecosystem
Runes
Runes is a decentralized protocol that allows launching of fungible tokens directly on Bitcoin, without the need of any layer 2 network. It is one of the most recent developments – launched in April 2024 – that is contributing to the growth and development of the Bitcoin ecosystem in several ways. While introducing programmability on Bitcoin, Runes facilitates more sophisticated Ethereum-like smart contract capabilities rather than using other offchain solutions.
For a blockchain’s underlying DeFi ecosystem to grow, fungible tokens play a vital role and Runes is enabling this for Bitcoin. The role of Runes is to enhance Bitcoin’s functionality, scalability, and security while fostering innovations similar to Ethereum. It is certainly making Bitcoin more versatile and appealing to a wider range of users and developers while supporting its continued evolution and growth.
Runes has also contributed towards increasing BTC’s demand drastically as developers would require it to launch applications on Bitcoin. This directly impacts on the market price of BTC which has seen surge with the launch of Runes in April and May. Runes were also once dominating over Bitcoin with over 68% transactions compared to simple BTC transfers on the network.
Ordinals
Launched in January 2023, Ordinals is a protocol that allows the launch of NFTs on Bitcoin. It opened up the Bitcoin network to the digital collectibles (NFTs) market which has been primarily dominated by Ethereum. Using Ordinals, artists and creators could mint unique digital artworks, music, and other forms of NFTs directly on Bitcoin. This innovation has attracted a massive user base on Bitcoin with remarkable increase in transaction volume and utility of BTC. It’s fairly obvious that with the increased transactions and user base, the activity on Bitcoin would also reach high levels and so will be the demand and price of BTC.
Both these protocols – Runes and Ordinals – have significantly increased onchain activity on Bitcoin in 2024 and demand for BTC in the market. They have also opened a wide door for Bitcoin to have a huge ecosystem of dApps and smart contracts like Ethereum and Solana.
The Late Volatility in BTC
In the past few weeks, BTC has become slightly more volatile compared to its historical price movements. It has been caused by several macroeconomic factors such as the recent FOMC meeting, Fed releasing rate cuts, the ongoing presidential election in the US and more. While crypto investors are not used to digest massive candles in daily or weekly closes, it has caused frustration in the market.
After attempting to break the range on June 7, BTC price fell from the high of $71,700 to as low as $63,267 on 1st July. This marks a decrease of nearly 13% and it has caused liquidations in hundreds of millions of dollars in short or long positions within the past two weeks. The price downtrend has also made crypto investors upset as they were expecting potential spikes following the halving.
Conclusion
The first half of 2024 has brought good news for investors of Bitcoin- the digital gold. There has been optimism all around the BTC’s market prospects with increased public adoption. Bitcoin has also seen major changes in market dynamics with it becoming more volatile in recent months and breaking probable trends while becoming unpredictable. It won’t be far fetched to say that the next half of 2024 is going to be even more turbulent for Bitcoin.
Also Read: Bitcoin Wins Back Faith of Investors With New 352K Addresses
