Where will Bitcoin (BTC -1.09%) go from here? Now that spot Bitcoin exchange-traded funds (ETFs) have obtained approval, there should be more room for Bitcoin's value to go up given that it is easier than ever to invest in it. But in the days following the approval, the cryptocurrency actually declined in value.

There aren't earnings reports or sales numbers that can help suggest where Bitcoin's value will go. Speculators play a big role in the digital currency's valuation, and that's why there can often be a great deal of volatility and risk when investing in Bitcoin. And right now, a large chunk of retail investors are expecting a significant decline in 2024.

Many retail investors expect Bitcoin to fall below $20,000 this year

According to a recent survey from Deutsche Bank, retail investors aren't overly optimistic about crypto's near-term future. More than a third of retail investors expect the price of Bitcoin to fall to less than $20,000 by the end of the year. And around 10% believe that it will finish the year between $20,000 and $40,000, suggesting a more modest decline.

There are some crypto bulls out there who believe it could rise to more than $75,000 before the end of 2024, but that is the minority, with about 10% of retail investors in the U.S. expecting it to hit those levels. And that falls to just 5% of retail investors in Europe, and even less than that in the U.K.

Could this be a self-fulfilling prophecy?

When it comes to speculation, expectations can play a large role in returns. If investors expect an investment to underperform, they could sell the asset, hoping to avoid a loss on it in the future. And if there is a large number of people holding that opinion, there could be a surge of selling, putting downward pressure on the investment -- which in this case would be Bitcoin.

There are some early signs that investors may already be cashing out. After approval of many spot Bitcoin ETFs in January, investors unloaded Bitcoin as the digital currency went in the opposite direction of where some investors might have expected it to go after the approvals (i.e., up). At the end of 2023, Bitcoin was trading at more than $42,000, but it is little changed since then.

The big test for Bitcoin could come in April

An expectation of a lower price for Bitcoin is troubling, because it could lead to more selling in the near future. But one potential catalyst that may help the digital asset's valuation is Bitcoin halving. That's when the rewards for mining the crypto are cut in half in order to limit its supply growth. After halving events, there is typically an increase in the price of Bitcoin. That's at least what has happened at previous halving events in 2020, 2016, and 2012.

However, at previous halving events, Bitcoin's value was never as high as it is now. In 2020, when it was trading at about $8,820 on halving day, it would rise to roughly $10,940 in the 150 days after the event, a 24% gain. A similar type of move this year could push Bitcoin up to around $50,000.

The next halving event is likely to happen in April. Whether Bitcoin does indeed benefit from a big rally after could dictate how the digital currency does the rest of the year, as that momentum could carry it for months.

Ultimately, there isn't a reason to think halving will have such a positive effect on the price, which suggests the event may already be priced in. But given the pattern of previous halving events, it wouldn't be surprising to see Bitcoin's price jump this year -- the big question is how much.

Should you buy Bitcoin today?

Bitcoin is a volatile and risky investment. It can be extremely difficult to try and predict where its value will go. For the majority of investors, it may not be a suitable investment option given its inherent volatility.

If you're willing to take on that risk and are looking to hang on for the long term, then it may make sense to invest in the digital asset given the approval of the recent spot Bitcoin ETFs, as that should bring in a broader pool of investors.

At the very least, investors should expect a bumpy ride, regardless of which direction you expect Bitcoin to go this year.