Despite the downs in bitcoin’s price, many crypto investors continued to believe in the future of bitcoin. Many of them say it’s only a matter of when, not if, bitcoin’s price rises to $100,000. But many other factors can affect bitcoin. What future awaits bitcoin in our unstable world?
More regulations
In many countries, officials have shown a particular interest in bitcoin regulation. On the other hand, using bitcoin is a hedge against financial surveillance and the decentralization of bitcoin enables a degree of censorship resistance. These reasons have made bitcoin attractive to many people.
But now, there is increasing discussion about tracking and regulating the crypto market. Changes in the state of bitcoin regulation affect bitcoin's price. Some investors sell their bitcoins which also drives bitcoin's price down.
But regulations are signals of the crypto market maturity. Regulating the bitcoin network is a challenging task in practice. Lawmakers focus on the additional activities of the bitcoin network and taxes. Eventually, the crypto market maturity will drive bitcoin's price up and reduce its volatility.
Bitcoin exchange-traded funds
A Bitcoin ETF (an exchange-traded fund) comprises bitcoin or assets related to Bitcoin's price. They were created to be traded on a traditional exchange directly from traditional investment brokerages.
The first Bitcoin ETF made its debut on the New York Stock Exchange in October 2021.
Because the US Securities and Exchange Commission (SEC) has not approved bitcoin ETFs for any fund, the fund doesn't hold bitcoin, just holds futures contracts.
Anyway, it makes cryptocurrency assets more accessible within traditional investment products. It means bitcoin will become more popular among institutional investors, affecting its price. In fact, more Americans could buy bitcoins and influence the crypto market with low risk.
Institutional cryptocurrency adoption
Many large companies across multiple industries have already taken an interest in bitcoin. And many financial experts predict more and more the interest in using bitcoins and other cryptocurrencies from businesses.
While most people don't use crypto to pay for goods or services many retailers have already added cryptocurrency to payment methods. Global corporations and retailers can create a chain reaction by using bitcoin that may add more credibility to crypto.
Institutional adoption will take some time before people start spending Bitcoin to buy gadgets, clothes, and products or pay their electricity bills. But the more the “real world” will use bitcoins, the more demand and value will increase.
In short words, institutional cryptocurrency adoption will drive bitcoin prices up. If you already hold some bitcoins, you will protect your savings against inflation and increase your return on investments.
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