Early Saturday, Bitcoin was slightly lower following the halving event, which reduced the issuance of the world’s largest cryptocurrency. Over the past 24 hours, the price has dropped by 1.3% to $63,676 but is still above the $60,000 mark it reached earlier in the week. This is due to concerns about inflation, interest rates, and tensions between Israel and Iran.
The halving, which was completed late Friday, is a change to Bitcoin’s monetary policy that will limit its supply. This is happening at a time when demand for Bitcoin is rising, thanks to the approval of new spot Bitcoin exchange-traded funds. Despite a 50% increase in price this year, Bitcoin is still below its mid-March high of $74,000.
Brian Vendig, president of MJP Wealth Advisors, believes that while previous halving events have boosted Bitcoin’s price, the current run-up has priced it to perfection. He also notes that the presence of spot Bitcoin ETFs, which were not available during previous halving events, has increased demand and interest in Bitcoin in recent months.
Crypto enthusiasts are hopeful that the halving will drive Bitcoin’s prices even higher in the coming weeks and months. After the previous three halvings in 2012, 2016, and 2020, Bitcoin experienced significant gains. According to CoinDesk, the last halving in May 2020 saw Bitcoin’s price soar from $9,500 to $65,000 within a year.
Thomas Perfumo, head of strategy at Kraken, believes that Bitcoin’s prices historically peak 12 to 18 months after a halving event. However, he also notes that the cryptocurrency hit an all-time high less than two months ago, which is earlier than in previous market cycles. With Bitcoin’s price currently only 10-15% above its previous all-time high, Perfumo suggests that we may not have reached the end of the current market cycle.
In addition to Bitcoin, Ether, the second-largest cryptocurrency, saw a 1.5% decrease to $3,045. Smaller tokens had mixed results, with Solana falling by 1.8% and Ripple gaining 3.7%. Memecoins, such as Dogecoin and Shiba Inu, saw a slight increase of 0.2% and 0.3%, respectively.
To continue reading, please scroll down to the advertisement. Crypto enthusiasts can contact Joe Woelfel at joseph.woelfel@barrons.com for more information.