Imminent $3 Trillion ‘Watershed Moment’—300% Crypto Price ‘Panic’ Could Be About To Blow Up Bitcoin, Ethereum And XRP

2 November 2023

in XRP

Reading Time: 5 mins read

11/02 update below. This post was originally published on November 1

BitcoinBTC and other major cryptocurrencies, including ethereum and XRPXRP, have rocketed this month (though a Federal Reserve flip could be about to cause crypto price chaos).

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The bitcoin price, up more than double since the beginning of the year, topped $35,000 per bitcoin last week, fueling a wider ethereum, XRP and crypto market rally that’s added $300 billion to crypto’s market capitalization in just a month—with a “huge shift” potentially not even “priced in.”

Now, analysts have predicted the bitcoin price could surge next year, driving it to $150,000 per bitcoin by 2025 and giving bitcoin a market capitalization of $3 trillion as a flood of bitcoin spot exchange-traded funds (ETFs) hit the market.

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hurtling toward what some think could be a price “watershed” moment.

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“You may not like bitcoin as much as we do, but a dispassionate view of bitcoin as a commodity, suggests a turn of the cycle,” Bernstein analyst Gautam Chhugani wrote in a note seen by CNBC. “A good idea is only as good as its timing—SEC approved ETFs by world’s top asset managers (BlackRockBLK, Fidelity et al), seems imminent.”

The world’s largest asset manager, BlackRock, fired the starting gun on a rush to get a bitcoin spot EFT to market in June when it filed its application with the U.S. Securities and Exchange Commission (SEC). The market was again charged in August when crypto asset manager Grayscale’s legal challenge to the SEC’s denial of its bid to convert its flagship Grayscale Bitcoin Trust (GBTC) into a fully-fledged bitcoin spot ETF was upheld by a court, ordering the SEC to review the application.

“We expect U.S. regulated ETFs to be the watershed moment for crypto and we expect a SEC approval by late 2023/first quarter of 2024,” Chhugani wrote.

11/02 update: Bitcoin and crypto traders “panic bought in the last few days,” according to crypto services company Matrixport, as a so-called fear-of-missing-out rally pushed the market sharply higher.

“Some traders anticipate that the SEC aims to conclude the BlackRock (and other issuers) bitcoin ETF applications by Christmas, which could keep the momentum elevated,” Markus Thielen, head of research and strategy at Matrixport, wrote in an emailed report. “The next round of SEC responses is expected by mid-January 2024, and it is highly unlikely that the SEC would signal any negative news before those deadlines.”

Thielen added he expects the latest bitcoin price rally has some more way to run, predicting it could come within touching distance of $60,000 per bitcoin before the new year.

Meanwhile, bitcoin’s next supply cut—known as a halving—scheduled for April 2024, is also expected to cause market chaos, potentially wiping out smaller bitcoin miners who use powerful computers to secure the network in exchange for freshly minted bitcoin.

“Post halving, we expect the bitcoin spot demand via ETFs to outstrip miner selling by 6-7 times at peak,” Chhugani wrote. “We expect bitcoin ETFs to be equivalent to 9-10% of spot bitcoin in circulation by 2028.”

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along with ethereum, XRP and other major coins, but remains far from its peak of almost $70,000 per bitcoin set in late 2021.

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Other market watchers have also cheered the expected arrival of a U.S. bitcoin spot ETF, predicting it will give credibility to the bitcoin and crypto asset class.

“The recent surge in the bitcoin price has resulted from increased rumors of an impending approval of a U.S. spot bitcoin ETF,” Greg Taylor, the chief investment officer at Toronto-based Purpose Investments—which launched a direct custody bitcoin ETF in Canada in 2021—wrote in emailed comments.

“Overall, this is an excellent indication that this asset class’s value proposition is apparent to many investors. Still, they are waiting for increased regulatory clarity and investment vehicles that are trustworthy and accessible before they start making sizeable portfolio allocations. If a U.S. spot bitcoin ETF is approved, it will be very positive for the sector and will likely positively impact the bitcoin price.”

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I am a journalist with significant experience covering technology, finance, economics, and business around the world. As the founding editor of Verdict.co.uk I reported on how technology is changing business, political trends, and the latest culture and lifestyle. I have covered the rise of bitcoin and cryptocurrency since 2012 and have charted its emergence as a niche technology into the greatest threat to the established financial system the world has ever seen and the most important new technology since the internet itself. I have worked and written for CityAM, the Financial Times, and the New Statesman, amongst others. Follow me on Twitter @billybambrough or email me on billyATbillybambrough.com.
Disclosure: I occasionally hold some small amount of bitcoin and other cryptocurrencies.