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Crypto investors who experienced challenging times in 2022 received some great news, especially in the second half of this year. It all started with BlackRock entering the crypto market and other trillion-dollar companies following its lead. Then came the XRP Coin victory and ETH ETF applications. Now, fears of a crypto crash due to the Binance case have been eliminated.
Will Bitcoin Reach $40,000?
Unless there is a major surprise, the question should be when will it reach $40,000. The Binance lawsuit, which has been discussed for months, was handled in such a way by the US that it prevented massive losses for investors worldwide. If there had been no settlement and harsh measures, including global sanctions, the potential bank run could have even toppled a powerful exchange like Binance.
Imagine the chaos if Binance users were subjected to OFAC sanctions. Indeed, this was done for the Tornado Cash mixer, and most Ethereum validators still comply with these restrictions. The US government prepared an indictment against Binance and Changpeng Zhao in the state of Washington on November 14th, but the documents were unsealed on November 21st. After admitting the charges, CZ stepped down from Binance management as part of the agreement. As a result, the incident was resolved with a $4.36 billion fine.
Prepare for Bitcoin ETF Approval
Binance has now turned over a new leaf, and an appointed auditor will continuously report the exchange’s activities to the US government for three years. This means Binance is now fully compliant with the US. A new era begins without speculation, positions against investors, and the risk of KYC violations. This also puts pressure on the SEC for the approval of a spot Bitcoin ETF. Gensler previously highlighted the “excessive market share on unregulated exchanges” in previous rejections. If the volume king exchange (Binance) has been tamed (according to the US), ETF approval may come now.
Bitcoin futures contracts should normally trade with a 5% premium. However, the current rate of 8% reflects the excessive demand for long positions. Although this level is lower than the 11.5% seen in mid-November, it highlights strong optimism regarding ETF approval.
At the time of writing, the Bitcoin price is at $37,500, and if Binance does not experience a surprise bank run and drag the market into chaos (despite the efforts of the US), 2024 could be a real bull market.