Why Bitcoin’s Mid-Halving Price Crash Will Be Different This Time

Some analysts believe that the four-year market cycle is turning and that the dates of the halving they may stop determining cyclical conditions as Bitcoin approaches the halfway point of its current halving cycle.

A halving is when the amount of Bitcoin (BTC) rewards issued for each new block mined is halved. The next halving will take place around May 5, 2024, and will reduce the block rewards to 3,125 BTC.

As Alerzio said in a blog on Santiment on April 4, “The important resistance on the way is $50,000.” In the blog it was stated that a break of this level by or near the next half of the halving cycle (April 11) would clear many doubts about the possibility that the traditional market cycle has been broken.

“If the price (stabilises) above this level, then we can give more credence to the thesis that says: ‘this cycle is different from the others’”.

However, with a few days to go, Bitcoin is down 3.31% in the last 24 hours and 6.51% in the week. According to data from Cointelegraph, the cryptocurrency is trading at $43,528.

Bitcoin has gone through four halvings so far, all of them featuring a similar series of three events over the course of four years, as described by Santiment. It appears that a divergence from that cycle has begun:

“In my opinion, the story will not happen in exactly the same way as before.”

Santiment has shown that, traditionally, after each halving, there has been a bull market in which the price has started to rise along with the network activity, followed by a spectacular climax in price that has led to an all-time high. . This pattern took place from the most recent halving in May 2020 to the all-time high in November 2021.

However, a prolonged bear market usually lasts until the next half of the halving cycle. Santiment notes that the market is now signaling a possible end to that four-year cycle, as the network is now near the middle of the current cycle, but an extended bear market is yet to be seen.

Bitcoin on-chain analyst, willy woo, has made a related observation. On March 20, he tweeted a follow-up to his October 2021 analysis saying that while previous market cycles were predictable, we may not see any more 4-year cycles.

He also noted the shortest bear and bull markets that have taken place since 2019 without seeing a significant blow-off-top.

Woo believes that the new unpredictable cycle will be dominated by a complex interplay between supply and demand, which may already be in play based on Santiment’s findings that network activity has risen at a much higher rate than in the last half. of the 2018 halving cycle. Higher network activity suggests higher demand.

The founder of Bitcoin data provider Look Into Bitcoin, Philip Swift believes that not only has the four-year cycle been broken, but “it’s been gone for a while”. In a Tweet on March 20 in response to Woo, he said that we have “one more cycle before BTC breaks out of it into a new phase of growth…”

Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information set forth herein should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.

Keep reading:

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  • Bitcoin moving towards $58,000? This 2019-like pattern suggests an uptrend for BTC
  • Analyst: Bitcoin At Risk Of One Last “Bear Market Capitulation” As Wealthy Investors Continue To Sell Off BTC
  • Bitcoin Derivatives Metrics Reflect Traders’ Neutral Stance, But Anything Can Happen
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