The impact of the Bitcoin halving on crypto prices is often overestimated, and the next halving, set for April 2024, may play out differently than previous ones — according to a leading analyst.
The halving event, which every four years cuts in half the rate by which new Bitcoin (BTC) is created, is generally considered one of the main catalysts driving Bitcoin’s biggest upside moves.
Despite the bullish narrative surrounding the halving, however, the event by itself does not necessarily guarantee Bitcoin’s price appreciation.
If the reduced supply of new BTC is not accompanied by significant demand, prices are unlikely to surge.
Also, the halving is an entirely predictable event, meaning all market participants know in advance when it will occur. Therefore, its current price may already reflect the halving’s impact before it happens.
“Things that we most anticipate generally don’t happen,” said Bloomberg analyst Mike McGlone, commenting on the much-anticipated event.
“And that’s what I’m concerned about. It’s complete consensus,” he continued.
Also, each time the halving occurs, its impact on the new Bitcoin supply decreases; and over time, its impact will eventually become irrelevant, he argued. Changes in demand, rather than supply, are therefore becoming the dominant factor influencing the price of Bitcoin.
So, how will the next Bitcoin halving impact the crypto market? And, if not the halving, what are the catalysts behind Bitcoin’s cyclical upside moves? To find out, check out the latest Coinpostman Report on YouTube, and don’t forget to subscribe!
- The Bitcoin halving event cuts in half the rate by which new BTC is created every four years.
- The halving is considered a main catalyst for Bitcoin’s biggest price increases.
- The halving alone does not guarantee Bitcoin’s price appreciation.
- If reduced supply is not accompanied by significant demand, prices are unlikely to surge.
- Market participants know in advance when the halving will occur, so its impact may already be priced in.
- The impact of the halving decreases with each occurrence, making changes in demand the dominant factor influencing Bitcoin’s price.
