While crypto ended 2023 on a positive note, we look forward to the sector in 2024 and beyond, with the following predictions.
The 2023 year had its fair share of ups and downs in the crypto industry. The year began with a long, drawn-out bear market that extended from 2021 and continued until recently. Thankfully, the market is regaining some of its trust, and investors are coming around and pumping money into the industry. As 2023 went by, several events spurred bullish predictions for 2024. For many reasons, the average investor is optimistic about 2024 being a big year for crypto, including everything from trends to adoption and solutions. The following are 10 crypto predictions for 2024 by Coinspeaker.
Prediction 1: New Bitcoin All-Time-Highs (ATHs)
Predictions for Bitcoin (BTC) are generally bullish. Most analysts and observers believe that the ongoing rally in the market’s king coin will continue for a long time until Bitcoin scales its current $69,000 ATH. According to Bitwise, BTC could hit $80,000 in 2024.
Bitcoin is likely to benefit significantly from two major events next year. The first is approving and launching a spot Bitcoin exchange-traded fund (ETF). The general market sentiment is that the United States Securities and Exchange Commission (SEC) may no longer have reasons to deny Bitcoin ETF proposals. In addition to the ETF approval, the next Bitcoin halving is expected in April next year. Analysts believe these reasons are potent enough to drive Bitcoin’s current rally well past its ATH and into the $80,000 range.
According to MarketWatch data, Bitcoin has already had an impressive year with 157% in returns. This is way higher than bonds at 2%, gold at 12%, and the S&P 500 index at 21%.
Prediction 2: Spot Bitcoin ETFs Approval
Indications suggest that the SEC will likely approve a spot Bitcoin ETF proposal in January. Since Gemini filed the first application in 2013, the Commission has rejected all proposals, citing problems with fraud and market manipulation. However, more than a dozen applicants have submitted applications this year, with several amendments made over the last few months following conversations with the Commission. Most of these amendments seek to address the SEC’s concerns about fraud, among other things. For instance, some applications now specify a surveillance-sharing agreement (SSA), which requires the ETF providers to share data with third parties. This reduces the risk of manipulation and ensures a basic level of transparency.
The SEC has until January 15 to approve or deny the application from giant asset manager BlackRock Inc (NYSE: BLK). For the application from 21Shares & ARK Invest, the expected decision date is January 10. According to Bloomberg Senior ETF Analyst Eric Balchunas, BlackRock’s likelihood of approval is 90%. The implications of approval are so huge that MicroStrategy CEO Michael Saylor believes the Bitcoin spot ETF may be Wall Street’s biggest development in 30 years. Also, a Matrixport report states that an approval could push Bitcoin to between $42,000 and $56,000. In October, blockchain analytics firm CryptoQuant estimated that ETFs could add $155 billion to Bitcoin’s market cap.
Prediction 3: Bitcoin Halving 2024
The next Bitcoin halving is expected sometime in April 2024. The halving event happens every 210,000 blocks, which takes about 4 years, and cuts miner rewards by 50%. Currently at 6.5 BTC per block, miner rewards will reduce to 3.25 BTC. Historically, the halving event has almost always positively affected Bitcoin. While the price may not immediately spike, Bitcoin usually benefits significantly.
CryptoQuant published a report putting Bitcoin at $160,000 next year, citing multiple factors, including the Bitcoin halving. Also, financial services giant Morgan Stanley (NYSE: MS) believes a significant Bitcoin rally will begin following the halving. Although Morgan Stanley did not specify a time frame, the bank believes the fourth halving will trigger a bull run.
Bullish predictions for Bitcoin include one from the Chief Executive Officer (CEO) of crypto investment firm BKCM LLC, who said Bitcoin will become scarcer than gold after the halving. This scarcity will likely play into regular market forces of supply and demand, spiking the king coin’s price.
Prediction 4: The Rise of Altcoins
The year 2024 will likely usher in altcoin season as Bitcoin continues its post-halving rally. A few altcoins have already had a good year and are poised to continue spiking despite Bitcoin’s rise. For instance, Solana (SOL) has recorded more than 974% in year-to-date (YTD) gains, with 420% in the last three months alone. Avalanche (AVAX) has also shown incredible potential, with 275% YTD and 347% over three months. In addition, Chainlink (LINK) has gained nearly 200%,
Another altcoin to watch out for is Bonk (BONK). The Solana-based meme coin has seen impressive growth, jumping more than 18,000% from $0.000000109 to $0.000020. Major exchanges Binance and Coinbase have now listed BONK for trading.
Prediction 5: JPMorgan’s Fund Tokenization
JPMorgan (NYSE: JPM), the largest bank in the US by total assets, recently completed a proof of concept in collaboration with Apollo Global Management (NYSE: APO) to test the tokenization of funds on a blockchain. Using the Avalanche blockchain, JP Morgan was able to automate actions like redemption, rebalancing, and subscription, all part of the portfolio management process. Following a successful test, JP Morgan will likely launch a tokenized fund on the blockchain in 2024.
Currently, over $5.5 billion worth of real-world assets (RWAs), such as equity and real estate, have already been tokenized on the blockchain. According to the Global Financial Markets Association (GFMA), this number could hit $16 trillion by 2030.
Prediction 6: Ethereum Price and Network Upgrade
Ether (ETH) will likely join the Bitcoin rally and continue to rise. The world’s second-largest cryptocurrency by market cap has seen more than 97% in YTD gains, and over 41% in the past three months. Ethereum’s function as the primary network for most of the decentralized finance (DeFi) sector is an advantage to the blockchain and its native token by extension. Forecasts state that the ~$2.3 billion users paid in network fees in 2023 could double in 2024 as more projects are launched on Ethereum.
Also, a major Ethereum upgrade, the EIP-4844, which reduces the network’s average transaction cost, could be a major game changer for Ethereum and blockchain in general. The upgrade could reduce the cost of layer-2 transactions by up to 90%, from $0.14 to $0.01.
Prediction 7: The Rise of Layer 2 (L2) Networks
An increase in blockchain activity, especially on the Ethereum network, could shine some light on layer-2 networks. The importance of these chains may become more highlighted as layer-1 networks struggle to handle an influx of users. In addition, gas fees that rise as activity increases are another factor in favor of layer 2 networks. The situation could bring more activity to these L2s and spur developers to float more L2 networks across multiple blockchains.
Prediction 8: Emergence of SocialFi
SocialFi, an amalgamation of social media and DeFi, is growing in popularity and will likely expand in 2024. These web3 platforms that offer a decentralized way to create and manage social media platforms and their content have already garnered fees worth $25 million. In 2024, as the idea of decentralization continues to spread, the blockchain space may witness an explosion in SocialFi, with more decentralized social media networks and tools launching to cater to the needs of prospective users.
Prediction 9: AI and Blockchain
The intersection of blockchain and artificial intelligence (AI) will become larger in 2024. Big tech companies are already launching AI assistants to help people perform several functions with little prompting. While these assistants can be very functional depending on the task, 2024 will likely see AI assistants extending their capabilities to help users make purchases via cryptocurrencies. This would likely begin with stablecoins or Bitcoin and may not be widespread until much later.
Prediction 10: Play to Earn, NFTs, and Memecoins
The play-to-earn (P2E) model for blockchain gaming was more popular in previous years than in 2023. Many users made some income off games like Axie Infinity, with some earning up to $2,500 per month. The reduction in P2E’s popularity may stem from multiple factors, including the crypto bear market. However, there might be a renewed interest in P2E games as the market recovers and begins to rally.
Major brands may pay more attention to non-fungible tokens (NFTs) as they use them to engage customers and build a community. Brands like Reddit and Nike have already begun NFT initiatives with various benefits to draw consumers closer. This trend may see more popularity next year as other brands try to build a community of crypto fans and enthusiasts.
For memecoins, BONK is all the rave. If history is anything to go by, the crypto sector can be quite receptive of memecoins, with some of them exploding several thousand percent, as in the cases of Dogecoin (DOGE) and Shiba Inu (SHIB). If 2023 is anything to go by, BONK will see further explosion before possible periods of retracement.