Bitcoin‘s long-awaited halving event ended on April 20, reducing the block mining reward from 6.25 Bitcoin to 3.125 Bitcoin. This was the fourth time rewards have been halved since Bitcoin’s inception, historically followed by significant price increases. After the 2012 halving event, Bitcoin’s value impressively increased by 9,500%, and a 3,000% increase was observed the following year after the 2016 halving event.
What’s Next for Bitcoin?
United States-based spot Bitcoin exchange-traded funds (ETFs) have recorded notable growth since their launch in January 2024. For example, BlackRock’s iShares Bitcoin Trust (IBIT) experienced a tremendous 71-day streak of daily inflows, reaching approximately $15.5 billion in assets before finally recording zero net inflows on April 24. This milestone placed IBIT among the top 10 longest inflow streaks.
Despite IBIT’s pause, other Bitcoin ETFs like Fidelity’s Wise Origin Bitcoin Fund and ARK Invest’s ARK 21Shares Bitcoin ETF continued to attract reasonable amounts of inflows during the same period. Since their launch, US spot Bitcoin ETFs have accumulated $12.3 billion in assets under management.
It is important to acknowledge that inflows slowed somewhat in the second quarter of 2024 compared to the $6 billion peak in February of the first quarter. However, analysts maintain a bullish outlook due to continued demand.
Insights from Prominent Figures on Bitcoin
Matt Hougan, Chief Investment Officer at Bitwise, believes Bitcoin ETFs are just getting started and highlights the untapped potential of institutions still assessing the situation, citing a lack of availability on major asset management platforms like Morgan Stanley and Merrill Lynch. Hougan predicts that Bitcoin ETFs could gather over $200 billion in inflows by the next halving in 2028, which would align with the historical growth trajectory seen after the initial launches of gold ETFs.
Moreover, he believes that central banks might start allocating Bitcoin as a non-debt reserve asset, which could help push the estimated Bitcoin price above $250,000 by 2028. Alvin Kan, Operations Manager at Bitget Wallet, stated:
“The regulatory clarity brought by Bitcoin ETF funds will have a positive impact on the asset’s long-term growth. Spot Bitcoin ETFs have the potential to promote regulatory arbitrage and help legitimize and broadly adopt Bitcoin and cryptocurrencies as a whole.”
According to Arthur Hayes from Maelstrom Capital, market factors like the upcoming US Treasury announcement to provide $1.4 trillion in liquidity could invigorate the crypto sector in the coming months.
