Matrixport has released a report today, predicting that the price of Bitcoin will jump to $50,000 this month. According to Matrixport, this bullish trend is influenced by multiple factors, including the potential approval of a Bitcoin Spot ETF, institutional buying momentum, and historical trends.
Bullish Factors and Institutional Interest
The analysis by Matrixport indicates that Bitcoin is expected to undergo a customary mid-to-end December consolidation before experiencing a robust breakout at the beginning of the new year. This breakout is driven by the anticipated influx of institutional investors who are eager to capitalize on potential rallies in the market.
“The importance of institutional investors not wanting to miss out on potential market upswings will lead to a swift and immediate buying flow when trading resumes in 2024,” says Matrixport.
Bitcoin has already surged past the $45,000 mark for the first time since April 2022, currently hovering around $45,200 with a 7% rise in the last 24 hours.
Bitcoin Spot ETF and Supply Shortage
A significant aspect to note is the speculation surrounding the approval of a Bitcoin Spot ETF by the US Securities and Exchange Commission (SEC), with Matrixport suggesting that the announcement could be made this week. Matrixport dismisses the idea of a ‘sell-the-news’ event, arguing that approval would legitimize Bitcoin as a valuable asset class for institutional portfolios.
“Approval of a Bitcoin Spot ETF would bring much-needed credibility and encourage more institutional investors to enter the market,” states Matrixport.
The report also highlights the potential risk on the upside, emphasizing the scarcity of available Bitcoin on exchanges as many holders have opted for cold-storage options. Matrixport estimates that up to $10 billion in fiat money may struggle to find sufficient Bitcoin on exchanges for ETF exposure, potentially leading to a supply shortage.
Bitcoin Halving Cycle and Historical Performance
In addition to the aforementioned factors, Matrixport takes into account the upcoming Bitcoin halving cycle expected in April 2024, along with historical trends suggesting robust performance during election years. These factors contribute to the overall bullish outlook for Bitcoin and the anticipation of a price surge to $50,000.
