- Bitcoin (BTC) temporarily dipped below $60,000 for the first time in more than a month sparking concern among investors ahead of the halving.
- With an anticipated supply shock, bulls are expecting BTC to stage a massive rebound that ends with the cryptocurrency reaching $80,000.
With just two days to go to the fourth Bitcoin halving, BTC has suffered a massive temporary setback. For the first time in more than a month, BTC has dipped below $60,000 a crucial support, ahead of the halving. The world’s largest cryptocurrency enjoys great support at this level and has rebounded to trade above $62,000.
The Bitcoin halving, expected on April 20th, is a significant event for the network and the community. This will see the reward provided to miners slashed in half moving from 6.25 to 3.125 BTC. This is designed to control supply with just 21 million BTC tokens ever created.
Bitcoin halvings cut new coin creation, making them scarcer and potentially more valuable. This combats inflation and mimics precious metals. While miners get less per coin, the remaining coins could be worth more.
Miners are the most affected by the event forcing them to be more efficient or to close shop. Bitcoin price is highly correlated to miners’ profitability and the halving always shakes up the industry and the asset’s price.
Earlier this year, BTC reached an all-time high of nearly 74,000, largely fueled by institutional adoption. The majority of investors bought in anticipation of a record rally after the halving. Historically, BTC has set a new all-time high in the months after its halving. With the halving and the recent launch of an ETF which has ushered in a new wave of investors, experts foresee the digital asset reaching $100,000 before the end of the year.
Bitcoin (BTC) Price Outlook
At the time of writing, BTC is trading for $62,707 after a 1.7 surge in the last 24 hours. But the coin is still in the red after a 10% dip in the last 7 days.
Although prices are struggling a few days before the halving, experts anticipate a supply shock that will lead to a radical price increase. With less supply and higher demand, the supply shock will drive prices higher in the days and weeks ahead.
Significantly, past halvings saw Bitcoin’s price surge, but with each event, the gains have shrunk. Price multiplied 93x, 30x, and 8x in the last 3 cycles. If this holds, the next rally might be less than 8x, though that could still mean massive profits for investors. However, it is also important to note that BTC’s popularity is at a record high, especially after the launch of a BTC spot ETF earlier this year. This has driven a new wave of institutional investors who could catapult the prices.
For now, a crypto analyst with CryptoQuant, Julio Moreno, speculates that Bitcoin’s price drop may be slowing down. His analysis suggests traders have few profits left to take, potentially reducing selling pressure.
Bitcoin selling pressure from traders may be declining as unrealized profit margins are basically zero now.
Traders’ realized price (pink line) has acted as support for prices during a bull market and it’s now at ~$60K. pic.twitter.com/rQbxKQ3W1T
— Julio Moreno (@jjcmoreno) April 18, 2024
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