Over the weekend, more than 20,000 Bitcoin industry leaders gathered in Nashville, Tennessee to discuss Bitcoin, announce new products, and hear from politicians about the future of Bitcoin in the U.S. Now, with a ton of new information coming out from the Bitcoin conference, let’s take a look at what might happen to Bitcoin in the second half of 2024.
Senators Cynthia Loomis and Tim Scott discussed their beliefs in Bitcoin on the first day. Scott said Bitcoin gives Americans financial autonomy and is "an important part of achieving the American dream." If Trump wins the upcoming presidential election, Scott will likely become the chairman of the Senate Banking Committee, giving his words more weight than any politician. If he becomes the chairman of the Senate Banking Committee, he promised to pass cryptocurrency-related legislation and bring it to the Senate floor. This is a welcome change from anti-crypto Chairman Sherrod Brown , who has been skeptical of cryptocurrencies, especially after the FTX debacle.
Scott’s stance is crucial to the passage of Cynthia Loomis’ ambitious Bitcoin Strategic Reserve Act. The bill would require the U.S. Treasury to acquire 1 million BTC over the next five years and hold them for at least 20 years. While the bill’s proposal is an important milestone for the blockchain industry, its chances of passing the House and Senate are slim. Given how little most politicians know about cryptocurrencies, spending over $50 billion on Bitcoin at current and higher prices is a tall order. Meanwhile, the bill was announced after Trump’s keynote speech. It’s very possible that Trump knew about the proposed legislation before the speech but chose not to acknowledge or support it in any way, which also casts a shadow on the bill’s passage. Trump should know that supporting the bill would be a huge boost to his growth in the cryptocurrency community, but he likely had reservations about how bold the plan was.
Trump’s announcement that the Department of Justice will not sell more Bitcoin during his administration, while a positive development, will not have a huge impact on Bitcoin for the rest of the year. If he is elected and implements this plan, it may trigger a domino effect, prompting other countries to follow suit. Some countries may even go further than the United States and actively acquire Bitcoin, hoping to get a head start in owning what is known as a potential global reserve currency. Therefore, while this announcement is very bullish for Bitcoin, it will most likely not have any huge impact on the price of Bitcoin unless the government makes other announcements.
The November presidential election could be a time of high volatility for Bitcoin. Given the current positions of the two parties, Bitcoin could see a small uptick if Trump is elected president, but the price of Bitcoin has already risen in part because Trump is favored to win. On the other hand, if Kamala Harris wins, Bitcoin prices could see a similar decline. Despite this, there have been some statements from Harris' campaign team that she hopes to restart relations with the cryptocurrency industry and promote reasonable legislation and innovation in the United States. Whether these rumors come true remains to be seen, and Kamala's change of attitude towards cryptocurrencies could guarantee that the cryptocurrency industry will have a lot to do in the next four years.
Bitcoin L2s and the expansion of the DeFi ecosystem received a lot of attention at the conference. The pattern of dozens of L2s built on top of Bitcoin will likely begin to roll out in the coming months and begin the battle to compete for market share among Bitcoin users. The most successful L2s will likely be the first to release a thriving ecosystem of interesting and useful applications. Also important is the security and trustworthiness of the L2, as Bitcoin users are reluctant to deposit their Bitcoin into any system that could be exploited or fail to guarantee their funds. Therefore, the Bitcoin L2 craze may not begin until OP_CAT is implemented, a technical upgrade for Bitcoin that enables a trustless bridge to the zero-based L2. Although there is no confirmed implementation date yet, the development of the upgrade is progressing rapidly, and one of the Bitcoin developer test networks has already implemented OP_CAT.
If the macroeconomic environment weakens, or an FTX-level black swan event occurs that disrupts the entire industry, these potential developments and narratives will all come to naught. If everything remains the same, the 4-year crypto cycle suggests that a massive bull run will arrive this fall and winter. This has happened in the months after the halvings in 2016 and 2020, but history is not guaranteed to repeat itself, especially with the massive institutional presence that ETFs bring. On the other hand, ETFs could push this cycle to new all-time highs, spurring mass adoption and legitimization of Bitcoin.
While Bitcoin could go in a few different directions for the rest of the year, most news and reports suggest that it is moving in a positive direction. Bitcoin's acceptance by politicians and the development of more utility through the DeFi ecosystem could be the start of a lasting bull run. However, the impact of an anti-crypto president, a global recession, or unfulfilled promises could prevent Bitcoin from reaching its true potential. Regardless, the end of 2024 looks like one of the most important periods in cryptocurrency history.
Author: BitpushNews Lincoln Murr
Compiled by: BitpushNews Scott Liu
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