Bitcoin
BTC

A Trip to the Moon: All-Time High in Sight as Bitcoin ETF Daily Volumes Surpass $1 Billion

bitcoin
Credit: Photo by Muhammad Asyfaul on Unsplash

Bitcoin’s largest monthly gain since 2020 has pushed the cryptocurrency to the brink of a fresh all-time high, with the industry’s leading analysts suggesting that we’re at the beginning of yet another monumental bull market. 

Forget the term ‘digital gold’, Bitcoin has just surpassed the Russian Ruble to become the world’s 14th largest currency, and it’s showing no signs of slowing down. 

The leading catalysts for BTC’s most recent surge stems from the long-awaited SEC approval of the Bitcoin Spot ETF and the pace of its daily trading volumes, as well as widespread investor expectations of an upcoming rally sparked by Bitcoin’s upcoming halving event. 

On February 22nd, a team of JPMorgan analysts led by Nikolaos Panigirtzoglou claimed that the Bitcoin halving event, which is set to occur in April 2024, is “largely priced in” following a flurry of retail investor interest. The week that followed saw BTC rally more than 22%. 

With the added thrust of a Spot Bitcoin ETF on Wall Street winning approval just weeks before a halving event, you’d be forgiven for believing that, this time, we really are going to the moon. 

But is the 2024/25 lunar mission for the cryptocurrency landscape clearer than 2021 and 2017? So far, the added power of Wall Street acceptance is paving the way for a cautiously optimistic outlook. 

The Rise and Rise of Bitcoin ETFs

Supporting the rise of Bitcoin, BlackRock’s BTC ETF saw $1 billion worth of trading volume surpassed on Tuesday, February 27, with two hours still left in the trading day. 

Likewise, the iShares Bitcoin Trust (IBIT) traded almost 32 million shares, surpassing the $1 billion volume mark at the same time. 

For both BlackRock and IBIT, it was the second consecutive day where $1 billion in trading volume was surpassed, representing an all-time high for respective funds in the weeks that followed their January 11th 2024 launch.  

Collectively, the 10 Spot Bitcoin ETFs saw $3.2 billion in trading volumes on Monday 26th January, representing their largest figures since launch, in which around $4.5 billion in volume was reached. 

These positive market movements directly impacted the value of Bitcoin, with the asset’s monthly gain surpassing 47% at the time of writing, which represents a level of growth that hasn’t been seen since December 2020. 

Its most recent market movements take Bitcoin to within touching distance of its all-time high value of $69,044.77, which was reached in November 2021. 

With the prospect of a halving event occurring in April, Bitcoin’s biggest supporters believe it’s only a matter of time before price exploration occurs. 

Quantifying the Bitcoin Halving Event

Despite Bitcoin’s outperformance, recent data showed that the volume of BTC held in wallets tied to cryptocurrency miners had declined by 8,426 in 2024 so far, representing the continuation of a slide that began in October. 

It’s believed that one key contributing factor to this is the upcoming Bitcoin halving event, which actively halves the BTC rewards distributed to miners to automatically improve the scarcity of Bitcoin. 

At present, miners generate Bitcoin by using significant computational resources to solve complex equations, with BTC distributed as a reward. 

With current estimates suggesting that the halving event will cut BTC distributed to miners from 6.25 to 3.125 on April 21 2024, miners appear to be selling their Bitcoin to buy more powerful equipment to maintain their efficiency. 

For investors, the Bitcoin halving event is significant. These events typically occur every four years on a cyclical basis, and historically they’ve been the catalyst for virtually every major market rally in Bitcoin’s history. 

Using Bitcoin’s stock-to-flow (S2F) model as an indicator, we can see that parabolic bull markets historically occur in the months that follow a halving event, due to the ramping up of the cryptocurrency’s scarcity and shortening supply. 

With Bitcoin’s total supply capped at 21 million, we’re now less than 1.4 million away from seeing all the BTC that will ever be created. This rapid slowdown is crucial to the price appreciation of the cryptocurrency. 

“Historical patterns show that BTC tends to rise gradually the year before each halving and maintains growth for 12-16 months afterwards,” explains Maxim Manturov, head of investment research at Freedom Finance Europe. “Given these trends, there is speculation that the peak of the current cycle could occur between April and August 2025, after the expected halving in April 2024.”

How High can Bitcoin go? 

So, what will Bitcoin’s price look like when the dust settles and the coin reaches the peak of its rally? 

There’s much speculation about how high Bitcoin can really go. The famous volatility of the cryptocurrency landscape is becoming more settled as institutional investors buy into crypto, but many experts agree that six figures is the minimum expectation for the year ahead. 

“With the thrust above the upper boundary of the 15-month channel, the target for the current bull market cycle scheduled to end in Aug/Sep 2025 is being raised from $120,000 to $200,000,” said veteran investor Peter Brandt on social media. 

However, more speculative market commentators are holding higher ambitions for the upcoming bull run. 

Seth Ginns, managing partner at CoinFund, believes that the cryptocurrency industry is in the process of “regulatory normalization,” which could ultimately see Bitcoin reach values of over $1 million. However, a value of between $250,000 and $500,000 within the upcoming halving cycle represents a “reasonable expectation” according to Ginns

For retail investors, the return of optimism into cryptocurrency markets means a level of excitement that has been missing throughout the landscape since 2021. Whether the perfect storm of ETF trading volumes and the upcoming halving event can clear the way for a moonshot remains to be seen, but it’s refreshing for crypto markets to be looking up rather than down after a long winter. 

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

BTC

Other Topics

Cryptocurrencies ETFs Markets

Dmytro Spilka

Dmytro is a finance writer based in London. His work has been published in The Financial Express, The Diplomat, IBM, Investing.com, FXEmpire, Investment Week and FXStreet.

Read Dmytro's Bio