According to Cointelegraph: In the world of cryptocurrencies, the "King of Cryptos," Bitcoin plays a leading role defining the industry's boom-and-bust cycle. Bitcoin programmatically undergoes a "halving" approximately every four years, reducing newly minted coins award to miners by half. This trigger of supply shock is partially responsible for the dramatic price fluctuations often seen in Bitcoin's value.
Multiple factors contribute to this renowned cycle, including network adoption, Bitcoin's expanding use cases like the Lightning Network for scalability and Ordinals for nonfungible tokens, and the ever-popular term, "institutional adoption."
Dan Held, a Bitcoin educator and marketing adviser, predicted a "supercycle" for Bitcoin, anticipating a surge due to factors like network adoption growth (Metcalfe’s law), halving-induced scarcity, and rising institutional adoption. Theoretically, this implies Bitcoin reaching new all-time highs without a significant downside due to sufficient adoption and institutional support.
However, despite factors such as reduced supply, network growth, and increased business and institutional backing, the support was insufficient to sustain Bitcoin's high of $69,000 at the end of 2021 leading to a market-wide fall.
Multiple global Exchange-Traded Funds (ETFs) were approved during the end cycle stage to support the adoption surge. Yet, these didn't provide the anticipated institutional support. As the United States constitutes over 42% of global equity markets, the acceptance of Spot Bitcoin ETFs might be a crucial step for the anticipated supercycle.
Although institutional adoption, increased scarcity from halving, and grassroots adoption, especially among lower-middle-income countries, are contributing factors, ultimately, the perceived value of Bitcoin by market participants will be the key determinant for the supercycle's materialization. The interplay of factors such as increased adoption and use and the geopolitical and socioeconomic landscape could shape the prospects of a Bitcoin supercycle by 2024.
Experts like billionaire venture capitalist Tim Draper and Julian Liniger, CEO of Bitcoin-only exchange Relai, hold varying views. While Draper sees more potential in the following cycle, Liniger foresees a possible significant demand increase due to supply reduction from the upcoming halving and rising interest.
In summary, anticipation for the Bitcoin supercycle revolves around whether increased institutional demand, supply scarcity, and global adoption will together tip the scales. As Bitcoin’s adoption and use are widely speculated, these factors set up an intriguing narrative for Bitcoin’s potential supercycle by 2024.
