According to the head of the world's largest cryptocurrency exchange Binance, Changpeng Zhao, one should not expect an increase in the Bitcoin rate immediately after the so-called halving. Zhao shared his thoughts on the impact of the planned reduction in the miner reward on the future price of the cryptocurrency in a publication on the Binance Feed platform.
Zhao timed the post to coincide with the start of the timer from
countdown to halving on the main page
page of the Binance website, according to which on
On October 9th there are 199 days left until the event.
Halving is a planned reduction in the number of newly issued bitcoins that are created and distributed among miners who verify and confirm transactions on the network. This is built into the Bitcoin software code to ensure that the total number of coins in the network never exceeds 21 million units.
What is Bitcoin halving and how will it affect the price of the first cryptocurrency?
In his opinion, in the months leading up to the Bitcoin halving (starting now), there will be “more and more talk, news, worry, anticipation, hype, hope, etc.” The day after the halving, the price of Bitcoin will not double overnight, and people will ask why this did not happen, Zhao is sure.
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According to Zhao’s observations, a year after the halving, the price of Bitcoin reaches new highs. “People will ask why [this happened]. People have short memories, predicts the head of Binance. - I do not claim that there is a proven cause-and-effect relationship. And history does not predict the future."
The first halving took place in November 2012, when the block reward - the amount of bitcoins awarded to miners for confirming each block of transactions - decreased from 50 to 25 BTC. The second reduction occurred in July 2016, when the reward decreased from 25 to 12.5 BTC. The third and final halving occurred in May 2020, when the reward decreased from 12.5 to 6.25 BTC.
At the end of August, analysts at the venture capital company Pantera Capital, with $3.8 billion in assets under management, predicted that the Bitcoin price could reach $35 thousand before the 2024 halving and up to $148 thousand after it. Surveys organized by opinion leaders from the cryptocurrency community show that more than half of investors expect a new Bitcoin rally after the halving in 2024.
