Is a $500,000 Bitcoin Rally Possible? Crypto ETFs to Consider – July 2, 2024

Since bitcoin got approval for spot ETFs in early January, bitcoin has been a bit volatile, a trend that may worry some investors. The cryptocurrency surged 70% after the approval, posting spectacular gains at first, but then lost momentum in mid-March, falling 14% since then.

However, despite the recent volatility, Bitcoin’s outlook remains encouraging in both the short and long term.

Encouraging signs from historical models

According to Motley Fool, the digital asset reflects a historical pattern that spans four years, during which it initially experiences a downtrend, followed by an uptrend over the past year. After experiencing a bear market, followed by a recovery in the second year and a continued rise in the third, the cryptocurrency goes through the halving process, after which a cyclical peak reaches its peak.

If we follow the pattern, Bitcoin experienced a bear market in 2022, which puts us currently in year three, with the halving taking place in April. While past performance is no guarantee of future results, we can speculate and leverage Bitcoin’s historical performance to get a glimpse of what 2025, year four, might hold.

Using Past Patterns to Predict Bitcoin Price

In year three, when the halving occurs, according to Motley Fool, Bitcoin increases by an average of 125%, which puts the digital asset at the end of 2024 reaching $100,000, from its early 2024 price of $44,000.

Based on past trends, the digital asset experiences a drastic increase of 400%, on average, in the year following the halving. If the trend repeats itself and Bitcoin ends this year in line with historical averages, its price could potentially reach around $500,000 by 2025.

Favorable changes in the supply and demand dynamics of the digital currency increase the likelihood that price projections will become reality.

Avalanche of influx

According to Coindesk, July has historically been a bullish month for the digital asset, with ETFs seeing roughly $130 million in inflows on the first day of July. Over the past decade, Bitcoin has averaged an increase of more than 11% in July, with 7 out of 10 months posting positive returns, the data shows.

With the cryptocurrency’s supply having been reduced by 50% since its halving in April, we could see an increase in inflows into Bitcoin spot ETFs in the coming months.

Fed Rate Cuts to Boost Prices

If the Fed cuts rates in late 2024, investors could view Bitcoin as an alternative to the depreciation of the dollar, which moves in the opposite direction of the Fed’s interest rate adjustments. The increasing likelihood of a Fed rate cut later this year, coupled with de-dollarization, tends to create opportunities in digital currencies.

Additionally, any rate cut by the Fed would boost risk sentiment, which in turn would help Bitcoin prices.

ETFs to consider

Below we mention some ETFs that allow investors to increase their portfolio exposure to Bitcoin and capitalize on its long-term bullish trend.

IShares Bitcoin Trust Registered (IBIT Quick QuoteI BITE – (Free Report) has gained 12.56% over the past month and 8.67% over the past three months.

Bitcoin Trust in Grayscale (GBTC Quick QuoteGBTC – (Free Report) has gained 14.03% over the past month and 8.41% over the past three months.

Fidelity Wise Origin Bitcoin Fund (FBTC Quick QuoteFBTC – (Free Report) has gained 12.98% over the past month and 8.64% over the past three months.

Bitcoin ETF ARK 21Actions (ARKB Quick QuoteARKB – (Free Report) has gained 12.55% over the past month and 8.67% over the past three months.

Bitwise Bitcoin Exchange Traded Fund (ETF) (BITB Quick QuoteBITB – (Free Report) has gained 12.56% over the past month and 8.70% over the past three months.