Coinbase Institutional Study Explores Bitcoin’s Halving and Ethereum’s Upgrade
A new report titled “Q1 2024 Guide to Crypto Markets” by Coinbase Institutional and Glassnode delves into the metrics and trends surrounding bitcoin and ethereum. The study offers a comprehensive analysis of the crypto industry and highlights the key factors that will shape the future of these digital currencies.
Bitcoin’s Halving
The report emphasizes that the Bitcoin network is approaching a crucial moment with the upcoming halving expected in Q2 2024. This event has historically had a significant impact on BTC’s market dynamics and is expected to be closely watched by investors. However, the report acknowledges that the limited historical data makes it difficult to predict the outcome with certainty.
“With only three halving events historically, we have yet to see a clear pattern fully emerge, particularly as previous events were contaminated by factors like global liquidity measures.”
Ethereum’s Cancun Upgrade
Ethereum is preparing for the Cancun upgrade, set to take place in Q1 2024. Following the successful Shapella upgrade, this upcoming improvement is expected to enhance the scalability and security of the Ethereum network. One notable aspect highlighted in the report is the introduction of Proto-Danksharding technology, which aims to make layer two (L2) transactions more cost-effective and increase transaction throughput.
Institutional Interest in Crypto
The Coinbase study also discusses the growing interest of institutional investors in crypto assets. It indicates a shift towards more mature market behavior, as evidenced by decreasing volatility and a preference for sophisticated investment strategies. Institutional players are now focusing on long-term positions rather than mere speculation.
Growth of Derivatives Market
The report reveals that the derivatives market for both BTC and ETH has experienced significant growth, with increasing volumes and open interest. This growth signifies a deepening market and demonstrates a diversification of strategies among investors. Market participants use bitcoin derivatives for various purposes, such as gaining capital-efficient access to BTC, hedging spot exposure, mitigating mining risks, and hedging other tokens without liquid and regulated derivatives.
Hot Take: Coinbase’s Positive Outlook and Potential Role as a Custodian
Coinbase Global (Nasdaq: COIN) could have a lucrative year in 2024, especially if it becomes a custodian for prominent spot bitcoin exchange-traded funds (ETFs) pending regulatory approval. Additionally, Coinbase’s stock has shown impressive growth in the past year, with projections suggesting that 2024 might outshine the cryptocurrency downturn of 2022.
By
By
By
By
By
By