A BTC halving occurs every four years and typically results in a long-term surge in the price of the headline crypto.
With cryptocurrencies proving the savior of investors as stocks continue to slide this quarter, investors are keeping a close eye on Bitcoin ahead of its highly anticipated halving, coming today, April 19.
So, what is it exactly, and, more importantly, will Bitcoin go up after the April 2024 halving?
Well, the halving refers to the reduction of block subsidy for Bitcoin miners from 6.25 BTC to 2.125 BTC, effectively lowering the reward miners gain from mining the flagship crypto.
While this may seem strange and mysterious, it’s actually an inherent and somewhat regular aspect of Bitcoin, one that tends to push prices up rather than the other way around. Indeed, Bitcoin experiences a halving once every four years, and the event typically raises the price of the crypto.
Put simply, the decline in the hashrate pushes some miners off the task, shrinking supply and raising prices.
Worth noting, the post-halving surge may not come immediately following the event. In fact, it can take up to a year and a half for the impact of the halving to be truly felt.
Price reaction is typically not immediate, said Rikke Staer, CEO of payments solutions platform Coinify. Major post-halving growth occurs [after] six and 18 months, and larger price movements become statistically less likely with increasing market size.
The last halving resulted in a five-fold increase in Bitcoin’s price, following its previous pattern. Is that what you should expect this time around?
Experts have slightly different theories on the end result of the halving, but most agree on one thing: BTC prices are heading up.
Plan B, the creator of the stock-to-flow (S2F) model, believes this Bitcoin halving will follow the historical trend of rising prices.
[In my opinion] this Bitcoin halving will NOT be different, the pseudonymous analyst wrote in a post on X earlier this week. All bitcoin price increase will again be around the halving. Buying 6 [months] before the halving and selling 18 [months] after the halving (green line) will outperform buy [and] hold. BTC [greater than] $100K in 2024. BTC top [greater than] $300K in 2025.
SkyBridge Capital founder Anthony Scaramucci also has brow-raising expectations for BTC following the halving. Indeed, in an interview on CNBC Squawk Box, Scaramucci shared that he thinks BTC can surge by more than 200% in the next year and potentially hit $200,000 per coin.
Scaramucci does qualify that he believes a near-term pull back of up to 15% could happen before BTC finds its post-halving stride.
Investment banking giant JPMorgan is one of the few naysayers of the halving. JPM analysts predict BTC will fall as low as $42,000 per coin after the event as they envisage bitcoin prices drifting towards once bitcoin-halving-induced euphoria subsides after April. They also believe the Bitcoin halving may be priced into BTC’s current $64,223 price tag per coin.
