The cryptocurrency market won’t just be focused on the passage of a Bitcoin spot ETF in the first half of 2024. According to BitcoinBlockHalf data, as of now, there are only 106 days left before Bitcoin’s fourth halving. Although halving does not usually trigger an immediate rise in Bitcoin, but takes several months to a year and a half to ferment, analyst Ali Martinez believes this is a bullish view worth paying attention to. This shows that the market is optimistic about the reduction in the supply of Bitcoin, because the halving means that the mining reward of Bitcoin is reduced by half, thus reducing the supply rate of new coins. Coupled with continued growth in market recognition and demand for Bitcoin, this could have a positive impact on Bitcoin’s price. However, investors should be aware of market uncertainties and risks and conduct adequate research and risk management in order to make
Bitcoin The mining reward will be halved every 210,000 blocks, approximately every 4 years. This event, known as the "halving," will result in a 50% reduction in the revenue of miners who verify Bitcoin transactions. The fourth halving is currently expected to occur around April 22, 2024, when Bitcoin’s block reward will be reduced from 6.25 BTC to 3.125 BTC.
Analyst Martinez mentioned in his analysis that according to historical data, Bitcoin halving events are always accompanied by a sharp increase in price, which has become the market consensus. He emphasized that regardless of the direction of the Bitcoin ETF, we should not ignore another bullish factor this year: Bitcoin’s halving. This can be seen by looking at the percentage increase in Bitcoin price after the past few halvings. Therefore, the halving event is considered a catalyst for price increases.
Within a year after the first halving, the price of Bitcoin increased by 6,000%. After the second and third halving, the price of Bitcoin increased by approximately 400% within a year.
Can the market expect that by mid-April, the Bitcoin price can also usher in a rise of more than 400%? What about the increase? In this regard, Bankless analyst JackInabinet mentioned in the analysis of "Where Bitcoin Goes Next" released on January 3 that although Bitcoin halving has brought about a bullish trend in history, this does not mean that it will be halved in the future. Will inevitably lead to price increases.
He mentioned that the issuance of Ethereum after the merger was reduced, but it did not lead to a price increase. He also pointed out that the reduction in issuance caused by the Bitcoin halving does not ensure that the price will be positively affected.
While alleviating selling pressure by reducing block rewards may have some upward impact on Bitcoin prices, the impact of this halving may be weaker than previous halving events. Investors in the market should not be surprised if the price of Bitcoin does not show the expected upward trend after the halving.
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