As the cryptocurrency ecosystem expands and its total market value increases, interest in Bitcoin and the broader crypto sector continues to grow. An anticipated rally is expected to significantly boost the crypto market in the coming year, a prediction supported by the rising number of global crypto asset owners and the overall market valuation.
Bitfinex Alpha analysts predict that the total crypto market value could fluctuate between $1.6 trillion and $3.2 trillion, with the number of global crypto holders potentially increasing their funds from $575 million to between $850 and $950 million. Despite Bitcoin still being 38% below its all-time high of $68,000 in 2021, the market shows signs of transitioning from a bear to a bull season, with many cryptocurrencies, including Bitcoin, having seen significant price increases over the past year.
Analysts believe this bull market holds substantial potential and could transform Bitcoin into a multi-trillion-dollar asset class offering significant value to investors. They have identified key metrics to watch as the crypto sector moves towards 2024, including the Bitcoin fear and greed index, which typically shifts from extreme fear to greed at the onset of bull seasons.
Bitcoin’s dominance in the crypto market continues to grow, with institutional investments expected to favor the leading crypto asset for at least the first half of the coming year. This dominance could be linked to numerous applications for spot Bitcoin exchange-traded funds expected to be approved in the U.S. by January.
Moreover, Bitcoin miners are preparing for the effects of the upcoming halving event in April, which will cut block rewards in half and reduce the rate of Bitcoin production. Miner exchange flows, significant indicators of market sentiment, suggest expectations of further Bitcoin price increases or active Bitcoin sales to upgrade mining equipment.
Analysts anticipate that miner exchange entries will remain low throughout much of 2024, as miners expect a price increase following the halving event.