Cryptocurrencies had a pretty challenging run in 2023, and many investors were left constantly looking at the present trading price of Bitcoin to better anticipate their next moves. It is no easy feat because values change so often, and numerous events can affect performance. However, 2024 has started relatively well, and investors are stoked about the possibility of increased growth throughout the following months.
The official approval of Bitcoin ETFs boosted morale like no other, considering that many investors were already bracing themselves for a fresh postponement. But their worries were averted when the SEC released its official ruling on January 10th. Now, the next step is the upcoming halving. Far from having an effect just on the Bitcoin market, it can be expected to give the entire crypto ecosystem a much-needed boost.
According to numerous analysts, this is the beginning of a new era in crypto, one in which mainstream acceptance will continue to increase.
Withdrawals
Visa has recently enabled crypto debit card withdrawals across 145 countries, eliminating the necessity for centralized exchanges. Recently, the crypto environment has become increasingly concerned about the environment’s ability to withstand the push for centralization. Regulatory pressures have intensified throughout 2023, and to many, this was a clear sign that regulators are attempting to impose strict rules on the crypto environment, make it easier to control, and deter it from its original purpose of ensuring decentralized connectivity among all users.
Now, Visa joined forces with Web3 infrastructure providers Transak to introduce withdrawals and payments that operate directly. The integration allows users to withdraw crypto coins directly from wallets to Visa cards. The integration enables better performance, as well as a more straightforward system that permits users to change their tokens into other tokens or even into fiat currencies.
The mainstream
The fact that crypto transactions are not yet part of the mainstream is a sore spot for many who believe that greater acceptance would help the marketplace be less prone to volatile fluctuations. Those who are concerned about centralization believe that the integration that has already happened is enough and that going further means having to accept the risk of causing more harm than good for the environment and changing its original purpose.
The acceptance of crypto withdrawals shows that the financial environment can take a step in this direction, though, and that crypto is likely to become even more mainstream in the future. The good news is that the integration also means that crypto utilization will get a boost and that transactions will be more convenient. This includes the users keen on maintaining the decentralized platforms fully decentralized.
For instance, Trust Wallet, MetaMask and Ledger users can now get funds directly from their wallets to their Visa cards. This naturally enhances the usability of digital assets and makes them more practical. For the longest time, cryptocurrencies were regarded as having no intrinsic value whatsoever because they don’t take the form of a physical asset.
Global users also benefit from this, as entering the mainstream means better protection against fraudulent activities such as money laundering. Therefore, platforms can verify their transactions and users and legally enable all financial tasks.
Previous engagements
This isn’t the first time that Visa has shown interest in cryptocurrency. Only during the past few years, it has made several moves into the ecosystem. Four years ago, in 2020, it joined forces with Circle, a blockchain firm, a partnership meant to show support for USDC. The stablecoin was set to be used on some types of Visa cards.
In April 2023, the company announced yet another initiative focused on stablecoin payments, with the product designed to ensure mainstream adoption. The aim of the project was to bring products to the general public that could facilitate the e-commerce of everyday life. Visa even announced that they were hiring software engineers who were adept at programming and could operate AI-assisted tools and smart contracts.
Only a few months later, in September, they worked with Solana to broaden USDC’s payment capabilities. The integration of Solana on Visa straight from its native blockchain, as well as that of Ethereum, means that the crypto can leverage the company’s treasury and create settlement systems that will bridge the gap between crypto transactions and traditional finance.
Inflation
Although Bitcoin has regained much of its lost value over the past year, there’s still a risk of recording some losses in the next few months. The ones to blame are macroeconomics, which could plunge BTC into the $35,000 level. The 2024 inflation risk can threaten Bitcoin’s current stability, and negate some of the 75% gains it made during the past twelve months. The difficult political situation marked by armed conflict in the Red Sea, the federal reserve policies, and the upcoming US presidential race all put a dent in the economy’s security.
All have clear implications for inflation, so they will also impact liquidity and interest rates. Higher shipping costs could mean that there will be a considerable spike in prices later this year, something the Fed will seek to mitigate. Weather is another reason why shipping costs will surge during the third and fourth quarters of 2024. However, even if these tendencies are minor in the beginning, they could become supercharged and get blown out of proportion as a result of rate cuts.
So, where does Bitcoin figure in all of this? Digital gold must find solid support below $35,000, meaning that a 30% correction from the high of the ETF approval might intervene. Some analysts have already started advising about the strategy of purchasing the March 29th $35K strike puts. Everything below that is also an opportunity to buy the dip.
To sum up, 2024 will not be an easygoing year for cryptocurrencies, but change is not bad. In fact, it is a must-have so that the marketplace can progress and move further. If you’re an investor, make sure to protect your assets and portfolio during this time in order to avoid inconveniences and losses. It’s the safest strategy you could use.
