Binance CEO Richard Teng says the Bitcoin halving is "unique" due to recent major events for the cryptocurrency and the broader market.
“This year's halving is unique in that it comes amid a number of other major developments in Bitcoin and the broader crypto ecosystem,” Teng told The Block in written comments.
"In addition to the ETF advance, which has spurred institutional interest and participation, another important trend in cryptocurrencies today is the rise of Layer 2 and DeFi activity on the Bitcoin network, driven by the popularity of the Ordinals protocol and Bitcoin inscriptions". he added.
Teng noted that the price of bitcoin has historically increased during the six months following each halving event.
The halving occurs every four years and halves the amount of bitcoin rewards given to miners. He said that this reduction in the supply of new coins may be behind the market's reaction to each event.
However, he noted that the scope for further growth depends on a variety of factors, including overall market sentiment and adoption rates. He added that bitcoin ETF approvals have already increased demand for bitcoin and increased its reach.
“While the above points amount to an optimistic outlook for BTC and the broader crypto market, it is important for investors, especially newcomers to the crypto space, to manage their expectations,” Teng said. “Immediate price changes following the halving are not justified, and their fundamental importance will manifest in long-term trends in the value, liquidity, adoption and position and acceptance of cryptocurrencies as an asset class.”
The Bitcoin halving will occur tonight, and block rewards will decrease from 6.25 BTC to 3,125 BTC over the next four years.
