The approval of spot Bitcoin ETFs is expected to tip Bitcoin’s supply-demand dynamics in the direction of a significant price surge.
The price of Bitcoin (BTC) may have slipped below $29,000, but that hasn’t deterred renowned analyst Tom Lee, from making a wildly bullish price prediction. Lee, who is Fundstrat’s managing partner and head of research, remains adamant that BTC is destined to attain greatness in the coming months.
In a Wednesday interview with CNBC, Lee insists that he sees BTC surging by over 400% from its current levels. He added that the BTC price could easily surpass the $150,000 mark by 2024 end. But that is only if the pending US spot-Bitcoin exchange-traded funds (ETFs) are approved.
According to Lee, approval of those applications would inadvertently tip Bitcoin’s supply-demand dynamics in the direction of a significant price surge. He said partly:
“If the spot Bitcoin (ETF) gets approved, I think the demand will be greater than the daily supply of Bitcoin, so the clearing price […] is over $150,000, it could even be like $180,000.”
Lee also noted that his prediction specifically has to do with the approval of a United States-approved spot Bitcoin ETF. And that would be understandable, given that the U.S. currently accounts for about 97.7% of the global trading volume for crypto-based ETFs. More so, there are already spot Bitcoin ETFs in Europe.
It’s a Win-Win Situation for Bitcoin, Says Tom Lee
Away from the Bitcoin surge that is dependent on the approval of spot Bitcoin ETFs, there is another reason for the asset to surge in price. Lee expects another push to happen from Bitcoin’s next halving event, which is expected to take place in April 2024.
According to Lee, this halving will cause supply to drop, therefore, making it necessary for the clearing price to increase. He, however, was quick to add that the price surge from halving will not bring the BTC price to six figures.
Presently, BlackRock and several other Wall Street giants have submitted applications for a Bitcoin spot ETF with the SEC. But they might not know their fate until 2024. That is considering that the regulator has a total of 240 days to decide after it starts reviewing an application.