The Bitcoin halving, one of the key events of 2024, is expected to take place in just 12 days. According to blockchain analytics firm IntoTheBlock, there are two main trends that traders and investors should pay attention to ahead of this highly anticipated event.
Price increases after the halving
As IntoTheBlock noted, Bitcoin price has continued to rise after each halving event.
This was due to the lower number of new coins put into circulation by miners.
Bitwise CEO Hunter Horsley believes the largest cryptocurrency could be on the verge of its most impactful block reward reduction yet. This is because the reduction in dollar supply is significantly larger compared to previous halvings.
As reported by U.Today, Ark's Cathie Wood expects Bitcoin price to rally after the halving, just like previous rallies. Meanwhile, Galaxy Digital CEO Mike Novogratz expects the price of Bitcoin to rise to $100,000 this year.
Diminishing returns
Based on historical data, the halving was seen as a key bullish catalyst. However, as IntoTheBlock noted, Bitcoin saw diminishing returns with each halving. Therefore, Bitcoin's post-halving rally, if it occurs, is expected to be modest.
However, the introduction of Bitcoin exchange-traded funds makes it harder to predict how the price of the largest cryptocurrency will perform after the upcoming halving. In addition to a supply shock, the flagship cryptocurrency is also seeing growing demand due to the success of ETF products launched by BlackRock and other major companies. Franklin Templeton's Sandy Kaul believes that such a unique setup is different from the previous three halving events. Bitcoin could therefore end up in “uncharted territory”.
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