Amid a contracting crypto marketplace, stakeholders and observers foresee Bitcoin price going bullish after the upcoming 2024 halving.
The next Bitcoin (BTC) halving is on course for March 24th, 2024, and is expected to positively affect crypto prices. In fact, analysts and observers believe that Bitcoin’s slated halving next year would signal the end of the sustained bearish phase. Conversely, these observers also predict that the 2024 BTC halving would usher in a fresh bullish run, going by historical data.
Bitcoin halving sees a decrease in the number of new tokens generated per block, leading to a lesser supply of new BTC. As a result of this development, the purchase of new Bitcoin becomes more expensive, which, in turn, drives up its price – all things being equal. Alternatively, the push on the supply side tends to decrease, thereby stimulating a greater demand on the demand side. Consequently, the lower supply paired with steady or higher demand hikes the token’s value markedly. Historically, the halving usually precedes some of Bitcoin’s most extensive bullish runs, which explains why optimism is riding high.
Several analysts are already predicting how high the BTC price will go after 2024’s halving, with Mark Yusko as one of the most prominent. According to the Morgan Creek CEO, the value of Bitcoin will exceed $100K after the next halving. Several more observers opine that the popular crypto may revisit its all-time high price of around $70K instead.
Despite the expected bullish run from a typical Bitcoin halving exercise, the effect of this positive development only occurs after a period of time. BTC price typically hits its upward trajectory three to six months after halving occurs.
Plan B Dissects the Upcoming 2024 Bitcoin Halving Exercise
Popular Stock-to-Flow model creator Plan B recently weighed in on the incoming 2024 Bitcoin halving exercise. A few days ago, Plan B asked the crypto community whether the BTC price would surge following the halving. This question led to a detailed analytical session of further forecasts and metrics reading.
With the halving on the horizon, Bitcoin is currently trading at just over $16K after climbing 0.19% in the last 24 hours. Furthermore, the leading crypto is now in the green after a sustained positive run over the previous seven days. However, this development is insignificant compared to the price level that BTC was trading at a year ago. In November 2021, the largest crypto by market cap attained a record high of approximately $70K per coin. Furthermore, around this time last year, BTC also hit a high market cap of over $1 trillion but is currently hovering at over $318 billion.
The Halving
The Bitcoin network issues new Bitcoins every 10 minutes. This numerical trend held sway for the first four years of BTC’s existence, resulting in 50 tokens. However, in 2012, the amount of new BTC issued every 10 minutes declined from 50 to 25, and again in 2016 from 25 to 12.5. During the last halving on May 11th, 2020, the BTC reward further split from 12.5 to 6.25 per block. The stated halving period saw the total number of BTC cut in half in decreasing amounts each time.
The number of Bitcoins available for mining remains limited as the total possible BTC quota is a 21 million maximum. Once this quota is reached, the production process that brings BTC to existence (mining) ceases.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
Source: https://www.coinspeaker.com/2024-bitcoin-halving-effect-btc-price/