Analysts are projecting a substantial rise in the value of Bitcoin (BTC) after the halving event, despite the world’s largest cryptocurrency plunging by nearly 15% from its recent all-time high of $73,738 in the past six days.
Charles Edwards, the founder of Capriole Fund, stated in a post on March 19 that it is “normal” to experience high volatility in the months leading up to and following the Bitcoin halving. He speculated that the 12-month period following the event would offer the best risk-reward opportunity for investors.
Edwards also predicted that there would be a shutdown of inefficient miners after the Bitcoin halving event, which is expected to take place between April 18 and 20. On March 20, Bitcoin briefly dropped to $61,593 and is currently trading at $62,690, according to CoinGecko data. Edwards acknowledged that although the correction is not yet complete, he remains optimistic about the long-term price action.
While Edwards attributed the halving as a primary catalyst for Bitcoin’s price movement, Ki Young Ju, the founder and CEO of CryptoQuant, argued that the Bitcoin market is being driven by flows from spot Bitcoin exchange-traded funds (ETFs), not the halving event. Ju explained that mining expenses would double after the halving, pushing miners to maintain certain prices for profitability. He added that although the direct cost per coin would increase to around $37,000, it would not be a problem for miners at the current price of $63,000.
Rekt Capital, a crypto analyst with 430,000 followers, warned that Bitcoin still had room to fall further. The analyst highlighted that BTC had entered a “danger zone” where historical retracements before the halving had begun.
Looking back at previous halving events, the price of Bitcoin dropped by roughly 50% in the months leading up to the 2020 halving. However, this decline was exacerbated by the COVID-19 pandemic in March. Bitcoin then consolidated around $10,000 for the rest of the halving year before entering a bull market in 2021.
In the 2016 halving, Bitcoin prices retreated by 33% before making gains towards the end of the year and eventually surging into a bull market in 2017, reaching a peak of $20,000.
However, the 2024 halving is relatively uncharted territory, as previous halvings occurred at much lower price levels for BTC and did not have the significant institutional support from spot Bitcoin ETFs.
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