Will Crypto Recover in 2024?

In 2020 and 2021, crypto was unavoidable. Tokens soared, traders became billionaires overnight, and the community was in a frenzy. It was a great time to be involved in the sector, with lots of new projects and use cases. However, 2022 was extremely rough. Many tokens fell by more than 75% from previous highs, and some questioned if crypto had a place in the world. Additionally, a wave of high-profile fraud cases contributed to the growing distrust of cryptocurrency. Despite these occurrences, some of the larger tokens recovered in 2024. Bitcoin and Ethereum led the way, each up around 100% in 2023. While these tokens showed signs of recovery, many are wondering what 2024 has in store for crypto. 

Will There Be a Crypto Bull Market In 2024?

Crypto investors are hoping to piece together what 2024 will look like for crypto. With several events and unknowns, a few major factors are worth watching.

The future of crypto has a lot to do with the macro environment. Bitcoin and cryptocurrency are closely tied to macroeconomic factors, as with most other investments. This is a pivotal time for economic events, as the Federal Reserve has several decisions to make regarding interest rates. Some believe that the Fed will begin cutting interest rates, which will incentivize more economic activity and increase the price of crypto, while others believe that the Fed will keep rates higher for longer in an attempt to completely squash inflation, which could cause crypto to fall.

Depending on what the Fed says it will do and investor sentiment, the price of crypto could fluctuate. For example, if investors believe that the Fed will not cut rates for some time, they could go risk-off and divest from riskier assets such as Bitcoin. 

What’s Needed for Crypto to Recover?

Apart from looser monetary policy and lower interest rates, a few other factors are important for crypto in 2024. 

First is the Bitcoin halving. Since its inception, Bitcoin has laid out a plan for how it will create new tokens. The number of new tokens distributed is halved every several years, resulting in an eventual end in 2140, when it reaches its maximum supply. This feature has usually been a positive for Bitcoin as it lowers the rate at which new tokens are introduced. 

Additional spot ETF approvals could also benefit crypto in 2024. The U.S. Securities and Exchange Commission (SEC) allowed the inception of 11 spot Bitcoin ETFs in early 2024, which was a landmark decision for crypto. Bitcoin rose significantly in the months leading up to the decision, and with a handful of other applications for additional spot ETFs, the effect could be seen on other tokens as well. 

Ethereum upgrades are set to roll out in 2024. These upgrades are supposed to help Ethereum further decentralize, lower transaction costs, increase speeds and increase security.

Safe Exchanges for Buying Crypto

If you believe that crypto is set to recover in 2024, then Kraken and eToro are the places to get some skin in the game. They are both known for their security and protection of consumer assets. On top of this, they also have low fees and great interfaces. You can get started on either of these trading platforms for just $10.

What Cryptocurrencies Will Recover in 2024 and Beyond?

If crypto does recover in 2024, Bitcoin and Ethereum should recover as well because they make up a majority of the crypto market. However, smaller tokens are more difficult to predict. While these tokens are influenced by the overall crypto market, there are also idiosyncratic events that can drive the price. Because of this, some smaller tokens could perform much better than Bitcoin and Ethereum in a bull market, while others could perform worse. 

Is It Already a Crypto Bull Market?

In the world of stocks, a bull market is typically considered a time when markets are up more than 20%. However, crypto can be volatile, so a bull market is much less agreed upon. A bull market can be easy to see in retrospect but hard to determine in the moment. Some believe a bull market is already in place, as crypto has risen substantially over the past year. However, others believe that crypto prices have seen some recent pullback, which could continue in the future. Ultimately, investors have to wait and see if 2024 is a bull market or not.