It has been less than two months since the BTC halving. The past three production cuts have all seen sharp rises and falls.
For example, the old retail investors in our currency circle are very impressed by the 312 plunge in 2020, when BTC rose to US$10,000 during the Chinese New Year. Then it plummeted to US$3,000, and then rose to US$20,000 by the end of the year. It can be said that there were twists and turns.
20 years is also known as the "Leverage Year", and many leverage stars were born, many of whom grew from a few dollars to hundreds of millions.
Then in April this year we will see the fourth Bitcoin halving event, which has greatly changed the supply dynamics of Bitcoin.
And historically, it has been associated with price increases for Bitcoin and the broader cryptocurrency space.
Historically, halving events have been a harbinger of significant price increases for Bitcoin.
The reality is that Bitcoin adoption has continued to grow since its inception fifteen years ago.
The deflationary nature of Bitcoin in circulation means that these supply and demand dynamics have caused Bitcoin’s price to rise after each previous halving, and while past performance can never be fully indicative of future results, understanding the growing adoption rate of a deflationary asset The potential impact is significant.
Anticipation of the halving event will also lead to increased interest in Bitcoin, and with it an inevitable increase in speculation and the possibility of “dump news” events.
As we saw with the approval of a U.S. spot Bitcoin ETF in January — another event that saw Bitcoin receive widespread attention — prices rose in anticipation of SEC approval.
After the funds were approved, there was a large short-term self-divergence, resulting in a sharp drop in prices. Bitcoin’s price has since recovered from the sell-off; however, the point remains that investors need to be alert to the market sentiment and speculative trends leading up to the halving in order to position themselves in a way that best supports their Bitcoin investment thesis.
The upcoming Bitcoin halving will have a significant impact on the number of Bitcoins entering circulation.
Looking at this event from a historical perspective, it is not unreasonable to assume that there would be a price increase concurrent with or following this event.
