The impact of the Bitcoin halving on crypto prices is often overestimated, and the next halving, set for April 2024, may play out differently than previous ones — according to a leading analyst.
The halving event, which every four years cuts in half the rate by which new Bitcoin (BTC) is created, is generally considered one of the main catalysts driving Bitcoin’s biggest upside moves.
Despite the bullish narrative surrounding the halving, however, the event by itself does not necessarily guarantee Bitcoin’s price appreciation.
If the reduced supply of new BTC is not accompanied by significant demand, prices are unlikely to surge.
Also, the halving is an entirely predictable event, meaning all market participants know in advance when it will occur. Therefore, its current price may already reflect the halving’s impact before it happens.
“Things that we most anticipate generally don’t happen,” said Bloomberg analyst Mike McGlone, commenting on the much-anticipated event.
“And that’s what I’m concerned about. It’s complete consensus,” he continued.
Also, each time the halving occurs, its impact on the new Bitcoin supply decreases; and over time, its impact will eventually become irrelevant, he argued. Changes in demand, rather than supply, are therefore becoming the dominant factor influencing the price of Bitcoin.
So, how will the next Bitcoin halving impact the crypto market? And, if not the halving, what are the catalysts behind Bitcoin’s cyclical upside moves? To find out, check out the latest Cointelegraph Report on YouTube, and don’t forget to subscribe!
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