Bitcoin's recent surge is primarily attributed to a supply shock following its April 2024 halving, where block rewards were reduced from 6.25 BTC to 3.125 BTC, thus slowing new Bitcoin issuance. This reduction in supply has tightened availability just as demand is rising, particularly through institutional investments in newly approved Bitcoin ETFs.
Analysts expect that, as institutional interest grows and supply remains restricted, the limited liquidity will continue to drive up prices. Although political factors may influence market sentiment, the halving effect is currently seen as the main driver of Bitcoin's gains.
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