Bitcoin Halving: Expert Predicts Strong Four-Year Cycle Performances
In a recent video, CNBC’s Fast Money trader Brian Kelly discussed the potential impact of the upcoming Bitcoin “halving” and its nuances. Kelly highlighted that the next Bitcoin “halving” is set to take place in April, resulting in the built-in code cutting block rewards issued to miners in half. He argues that the halving will limit new supply, making Bitcoin scarcer than gold.
Following the halving, Kelly mentioned that the 12 to 16 months after past halvings marked Bitcoin’s strongest four-year cycle performances. He believes that the upcoming April halving will cut daily Bitcoin mining issuance by 50%, retaining bullish influence despite cycle differences.
Kelly pointed out that only 900 coins will be issued daily after the halving, making BTC more scarce. The reduced issuance of new Bitcoins typically creates a supply shock, leading to increased demand and upward price movements. However, Kelly voiced concerns about potential differences this time around, primarily driven by Bitcoin’s current high valuation.
The Fast Money trader referenced the stock-to-flow ratio, a metric comparing the annual production of an asset to its existing supply, where Bitcoin’s reduced issuance results in a stock-to-flow ratio surpassing that of gold, a historic first.
In historic context, Bitcoin halving events have historically been associated with significant price increases in the months following the event. This is due to the reduced supply of new coins and the potential for increased demand. However, it is important to note that past performance is not indicative of future results and the cryptocurrency market is known for its volatility.
In recent news, Bitcoin’s price made a surge past the $43,000 level. According to CoinMarketCap, BTC has surged from a 24-hour low of $41,421.15 to a high of $43,700 before settling at its current price of $43,444.
Bitcoin is up by 4.44% in the last 24 hours and 12.89% in the last seven days. It remains uncertain whether Bitcoin is poised to surge higher or exhibit a reversal, given the market’s unpredictability.
In conclusion, amid the upcoming Bitcoin halving, experts like Brian Kelly remain optimistic about Bitcoin’s potential for bullish performances. However, it’s important for investors to approach the cryptocurrency market with caution and an understanding of its historic and current trends.
