TL;DR
- According to Bitwise Asset Management, the halving event tends to be underestimated in terms of its long-term impact.
- While the month following previous halvings has always been modest, the following year has seen notable gains, such as the 8,839% increase after the 2012 halving.
- Markus Thielen warns of a possible post-halving miner sell-off, while some analysts assess market corrections, with estimates that Bitcoin could fall to $51,000.
The crypto market is awaiting the upcoming Bitcoin halving, scheduled for April 20. According to Bitwise Asset Management, historically, this event has been underestimated by the market in terms of its long-term impact. Price movements in the month following previous halvings have been disappointing, but data reveals significant gains for the leading cryptocurrency in the subsequent year.
Bitwise exemplifies this through the 2012 halving, where Bitcoin saw a modest 9% increase in the month following, followed by an explosive 8,839% increase in the subsequent year. Similar patterns can be observed in the 2016 and 2020 halvings, with initial drops followed by significant rebounds.
Historically, the Halving Has Been Good for Bitcoin’s Price Long-Term (a Look at the Data)
The change in bitcoin’s price in the year following the halving:
2012: 8,839%
2016: 285%
2020: 548%The change in bitcoin’s price in the month following the halving:
2012: 9%
2016: -10%… pic.twitter.com/aaXSakLfko— Bitwise (@BitwiseInvest) April 16, 2024
Bitcoin Could Fall to $51,000
However, in this case, Bitcoin has reached an all-time high before its halving, something unprecedented in the cryptocurrency’s history. Despite breaking that barrier, many industry executives express short-term pessimism. Markus Thielen, head of research at 10x Research, has warned of the possibility of a post-halving miner sell-off, which could exert downward pressure on the markets.
Meanwhile, Fred Thiel, CEO of Marathon, suggests that the halving’s bullish momentum is already priced into the market, anticipating what would normally be a post-halving rally.
On the other hand, analysts like Rekt Capital and Cold Blooded Shiller are evaluating market corrections since the 2022 bear market bottom. Rekt Capital has identified five significant corrections, with declines ranging from 18% to 23%. Meanwhile, Cold Blooded Shiller warns that 30% corrections are not unusual, hinting at the possibility of Bitcoin falling to around $51,000.
While corrections and concerns about a possible post-halving miner sell-off are important factors to consider, history suggests that Bitcoin may be poised for exponential growth in the coming year, dispelling short-term expectations.
