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Bitcoin prices usually rise for several months after each halving. This time, however, the market expects the reaction to the halving to be different. The highly anticipated fourth Bitcoin Halving took place on Saturday evening shortly after 2:09 (CEST). Immediately after the halving, the price of Bitcoin remained unchanged at around $63,000. In the week before the halving, the price of Bitcoin fell by 4%. The Bitcoin exchange rate today, i.e. 29/04/2024, is 62,294 dollars, or, if you prefer, 1,465,207 CZK.
Bitcoin halving is an event that occurs approximately every four years. The number of Bitcoins released as mining rewards will drop by 50%. So far it has been 6.25 BTC; with the fourth half, it fell to 3,125 BTC. This means that fewer Bitcoins will enter circulation, reducing supply as demand increases. Additionally, the supply of Bitcoins is finite, so there will be a maximum of 21 million coins. There are currently around 19.6 million BTC in circulation, with a good 900 added every day.
Will the price of Bitcoin rise even after the halving in 2024?
After a halving, Bitcoin prices typically continue to rise for an average of seven months after the halving. However, this rally is also seen as a warning sign of an inevitable market crash or decline, as many investors, especially long-term investors, are selling their Bitcoins and reaping the profits after the halving.
On the other hand, analysts believe that Bitcoin price movements will be somewhat different after the halving that just happened, as Bitcoin had already seen significant gains and even new record highs before the halving. So the overall price cycle that usually surrounds this event appears to be more complicated than it has been in the past.
One of the reasons why this Bitcoin halving may not trigger as big a price increase as the last halving in 2020 is that the US Federal Reserve had a very loose monetary policy at the time. This meant that interest rates were relatively low at the time.
But that has changed significantly in recent months as the US central bank has raised interest rates to combat stubbornly high inflation. Higher interest rates have led to more interest in things like US Treasuries and other interest-bearing assets and investments. This situation logically caused the outflow of potential investors.
Therefore, ordinary investors may still be wary of investing in Bitcoin before interest rates drop – if rates on standard investment instruments are high, there is little reason to invest in the volatile cryptocurrency that Bitcoin undoubtedly is. Another important reason for this hesitancy is that the cost of living continues to skyrocket in many parts of the world, leaving many investors struggling to afford basic necessities and mortgages, which significantly reduces disposable income. However, as Investiční web reports, the situation is still relatively uncertain – even with regard to the upcoming presidential elections.
Why is the current Bitcoin price good news?
For a very simple reason. If the price does not rise significantly, you have the opportunity to buy Bitcoin relatively cheaply. Given that the price of this cryptocurrency is predicted by many experts to be above $100,000 per BTC by the end of 2024, the Bitcoin exchange rate is actually quite favorable today.
This is good news for investors who have chosen a “buy and hold” strategy – that is, they buy Bitcoin, but see its use in the horizon of several years. However, it is also an opportunity for those who speculate on the price. In both cases, it pays to buy low and sell high.
