Key Takeaways:
•Bitcoin will undergo its fourth halving at block 840,000 (expected on April 20), with the block reward dropping from 6.25 BTC to 3.125 BTC.
•Miners’ profitability will come under pressure as issuance revenue is halved, which will drive mining operations to be more efficient, while revenue based on transaction fees becomes increasingly important.
•Continued or increased demand for Bitcoin could offset forced selling, reducing issuance and driving price action.
The significance of halving
Each halving event is a critical moment in Bitcoin’s lifecycle as it directly affects Bitcoin’s issuance and inflation rate, reduces block rewards (newly issued Bitcoins that incentivize miners to produce blocks and keep the network secure), and can have an impact on Bitcoin’s market value due to increased scarcity.
As the name implies, the halving refers to a 50% reduction in the issuance of Bitcoin, effectively halving Bitcoin's inflation rate (the rate at which new Bitcoins enter the market) in half. With this halving, Bitcoin issuance will drop from 900 Bitcoins per day (1.8% issuance) to 450 Bitcoins per day (0.9% issuance). As a result, the rewards miners receive for validating new blocks and securing the network (excluding fees) are also reduced by half, affecting their incentives and profitability (more on this in the next section). Halvings are set to occur every 210,000 blocks, approximately every 4 years, and are immutable - the rules governing this process are etched into the code that underpins the Bitcoin network.
When the market crashes, pay attention to the coins that are resistant to the fall, so that when the market rebounds, these coins will rebound the fastest and most violently.
The currencies that have been strong in the past two days and are also the currencies that will be given priority for layout in the future:
1.FTM
Fantom maintains its position as one of the top DeFi coin tokens thanks to its unique consensus algorithm. Today, the token’s ecosystem tops the category of top intraday gainers.
However, FTM has lost more than 6% of its price in the past 24 hours due to the bearish trend in the cryptocurrency market. Pressure from short sellers has forced prices down, with an overall drop of 27% in the past seven days.
Nonetheless, FTM holders may see a breakout in the coming weeks thanks to the recently announced gas monetization initiative. This concept proposes distributing gas fees as bonuses to projects in the ecosystem that generate the highest gas fees.
According to a Twitter update, the Fantom Foundation will set aside 85,000 FTMs every quarter. The platform believes that dApps generate the majority of engagement and use cases for its ecosystem.
The regulated stablecoin project is another emerging initiative on the platform that will increase the future value of FTM. News from Phantom revealed that the stablecoin USDC.e aims to ensure liquidity availability on DEX on the FTM platform.
Therefore, Fantom may see more use cases in the future. The project is already taking steps to ensure the first-mover advantage. The return of the bull market may give FTM the momentum it needs for the next leg up.
2.W
Wormhole (W) Wormhole’s drastic price drop came as a surprise to investors as they saw the asset’s price drop from over $1 to as low as $5. The plunge in value stems from the overall performance of the cryptocurrency market, which makes it easy for new cryptocurrencies to make a comeback.
In the past 24 hours, Wormhole’s price has recovered by more than 10%, and the asset’s trading volume is gradually returning to its original level. Technical data on the W chart also suggests that Wormhole has further room to rise.
At the time of writing, Wormhole has a neutral Relative Strength Index value, which can be interpreted as the asset finding fair value. As the forces of demand and supply exchange, the asset may eventually ascend the price ladder. The current intraday high is $0.608, suggesting a chance for further upside.
Besides promising technical indicators, the project’s fundamentals could also contribute to its upside. Assets in the interoperability space have seen an impressive rebound from the market decline. Wormhole is a cross-chain bridge provider that allows blockchains to seamlessly move assets within the crypto ecosystem. The project has seen an increase in use cases, which validates its long-term viability.
As Wormhole adoption increases, so too will the value of its native cryptocurrency, W. However, as it regains lost ground, investors can take advantage of the recovery trend. Holding a position on the way up can offer the opportunity to earn short-term returns on investment.
3.STX
Bitcoin’s recovery has paved the way for assets in its ecosystem. Stacks lost more than 20% of its value due to the recent market downturn. Its price plummeted, causing its value to drop from $3.18 to $2.19. However, STX is recovering, with its price climbing to the $3 range. The chances of breaking through the $3 level depend on how BTC performs in the coming days.
Nonetheless, technical indicators point to short-term price declines that could lead to further bullish momentum later this month. STX’s short-term moving averages are below current prices.
The lagging moving averages suggest that the bears might force another pullback in the coming days. On the other hand, STX has MA200, which is below the current price, suggesting that STX bulls can maintain the upper hand for a long time.
Additionally, the Stacks Nakamoto upgrade is in the works, which is another catalyst that could propel Stacks to become a true identity as a second-layer platform for Bitcoin. It is claimed that this upgrade will incentivize users to explore applications within the STX ecosystem. Ultimately, this upgrade will permanently increase the value of STX to over $3.
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