Asset management firm Ark Invest has highlighted four major catalysts that will drive the price of bitcoin this year. “Bitcoin has emerged as an independent asset class worthy of a strategic allocation in institutional portfolios,” Ark described in its Big Ideas 2024 publication. “The shift in perception of bitcoin — from a speculative instrument to a strategic investment in a diversified portfolio — should characterize its evolution in 2024.”
Ark Invest’s Big Ideas 2024
Ark Investment Management (Ark Invest) published its “Big Ideas 2024” on Wednesday. “Big Ideas offers a comprehensive analysis of technological convergence and its potential to revolutionize industries and economies,” the asset management firm explained. Citing Ark’s research, the report states that “bitcoin has emerged as an independent asset class worthy of a strategic allocation in institutional portfolios.”
The Big Ideas report discusses various topics, including four “major catalysts” that Ark expects to drive the price of bitcoin in 2024. The first is the launch of spot bitcoin exchange-traded funds (ETFs) in January. Ark explained that spot bitcoin ETFs “are traded on major stock exchanges, allowing investors to buy and sell shares through their existing brokerage accounts, and should reduce the learning curve and operational complexities associated with direct investments in bitcoin.” Ark was one of the asset managers that launched a spot bitcoin ETF on Jan. 11.
The second major catalyst is the upcoming Bitcoin halving, which occurs approximately every four years. The next one is slated for April. Ark detailed:
Historically, each halving event has coincided with the beginnings of a bull market. Expected in April 2024, this halving will reduce bitcoin’s inflation rate from ~1.8% to ~0.9%.
Another major catalyst is “regulatory developments,” the report states. Ark pointed out that “The bankruptcies of FTX and Celsius have advanced the push for more transparent and open global crypto regulation, including the potential passage of a U.S. bill establishing a regulatory framework for cryptocurrencies, and the implementation of Europe’s Markets in Crypto-Assets (MiCA) regulation, which mandates licensing for crypto wallet providers and exchanges in the EU.”
The fourth major catalyst for bitcoin this year is “institutional acceptance,” Ark said, elaborating:
The shift in perception of bitcoin — from a speculative instrument to a strategic investment in a diversified portfolio — should characterize its evolution in 2024.
The asset management firm noted: “Exemplifying this evolution, Larry Fink, CEO of Blackrock, has shifted his stance from bitcoin skepticism to its potential as a ‘flight to quality.’” Blackrock, the world’s largest asset manager, was among the firms that launched a spot bitcoin ETF on Jan. 11. Its Ishares Bitcoin Trust (IBIT) has since accumulated over 70K BTC.
Last month, Ark Invest CEO Cathie Wood said her firm expects spot bitcoin ETFs to attract “substantial institutional flows” that will push the price of bitcoin “much higher.” She also said the probability of bitcoin reaching $1.5 million by 2030 has increased.
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