Bitcoin Halving in 2024: Short-term Surge Followed by Post-event Slump, Predicts Steno Research
Summary:
Steno Research predicts that the anticipated Bitcoin halving event in 2024 may cause a short-term surge in BTC's value, but expect it to dip below the pre-halving price in the months following the event, following a pattern similar to the 2016 halving. This will result from a surge in selling pressure as Bitcoin miners aim to cover their operational costs. However, the halving bears bullish potential once market adjustments have settled down, and temporary investors have exited the market. Currently, Bitcoin trades around $71,563.
The anticipated Bitcoin halving event in 2024 is a much-debated topic among cryptocurrency traders, many of whom see it as a critical juncture in the crypto ecosystem. Despite this, market experts at Steno Research predict that this event will follow the pattern of "buy on the rumor, sell on the news." Bitcoin has had three prior halving occasions, with the mining rewards going from 50 BTC to 25 BTC in 2012, reducing further to 12.5 BTC in 2016, and lastly, to 6.25 BTC on May 11, 2020. Drawing parallels from the 2016 halving, Steno Research believes the event will see a short-lived increase in BTC's value, followed by a slump post-halving.
The last three halving events have seen miner reward cuts, from 50 BTC to 25 BTC in 2012, then to 12.5 BTC in 2016, and finally to 6.25 BTC during the most recent halving on May 11, 2020. Steno Research has indicated that a similar trail may be followed in 2024, replicating the aftermath of the 2016 halving, where sale volumes surged exponentially during the subsequent four months.
As per the research, BTC value may witness an uptick leading to the halving, but the surge could slide below the pre-halving price within the initial 90 days post the event. The study established similarities between BTC’s prices pre and post the 2016 halving and suggests an identical pattern may follow in the upcoming halving.
Moreover, the report indicates that Bitcoin's price stayed under the pre-halving value for a complete 90 days after the halving. Particularly, on day 90 post-halving, Bitcoin's price was 8.4% lower compared to its pre-halving value, according to Steno Analyst Mads Eberhardt. He draws on data from CryptoQuant showing Bitcoin's daily mining rewards reaching new highs with the price trading near an all-time high, indicating that despite the next halving reducing BTC issuance to the lowest ever, the dollar value of this issuance would be significant.
Analyzing the current Bitcoin price around $71,563, the upcoming halving value is concluded to be around $224,512 worth of Bitcoin, which is a massive jump from the $55,000 rewarded to miners post the last halving. Consequently, miners are expected to sell all their Bitcoin gradually, thus leading to an increase in sell-side pressure, eventually resulting in BTC price correction several months post-halving.
However, Eberhardt also believes that this halving could drive the bullish behavior of Bitcoin's price once the selling pressure from miners subsides and temporary investors, or "weak hands," exit the market. Another expert, Alex Wice, also adds that the halving event could trigger an immense repricing leading to a massive surge in Bitcoin's price.
Furthermore, the CEO of Bitget Wallet predicts some post-halving short-term instability but asserts that the bullishness induced from the event could incite substantial interest and expansion in the encompassing Web3 ecosystem. Currently, Bitcoin is trading at $71,563, showing a 3.8% increase in the last 24 hours.
Readers should perceive this report as informational and not as financial advice or suggestions. Investing and trading entail risks, and it's crucial to conduct individual research before making any financial decisions.
Published At
4/8/2024 11:56:28 PM
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