The cryptocurrency world is fast-paced, and forecasting with certainty is unrealistic. The same risk as investing in a startup, developing your own business, gambling, and even buying a lottery ticket. Even in a casino, you are at least guaranteed to get a 22Bet Welcome bonus. In the volatile world of cryptocurrency, where yesterday’s gains fell to zero the following day. One has to keep watch for events with the capacity to expand wealth: the Bit-coin Halving.
What is Bitcoin Halving, and Why Does It Matter?
About every four years, bitcoin halving sparks the attention of many investors, miners, and critics alike. The question is: What is Bitcoin halving? Why should you look forward to the bitcoin halving ripple effect in the markets?
Mathew Sigel of Denis Zinoviev (digital research company) says Bitcoin Halving is a momentous event that happens roughly every 210,000 blocks. Which is about every four years. Its main goal is to drip the supply of bitcoin in the market and guarantee long-term value stability. How does this translate to investors and fanboys?
Bitcoin halving is the reduction of bitcoin to mined by validating transactions. This activity adds them to the blockchain. The feature slows down the supply of new bitcoins made, in turn limiting the total supply over time. This scarcity puts a premium on Bitcoin in the finance market. To get a bird’s-eye view of what happened, refer to the graph below for bitcoin rallies before and after halving events.
Historical Impact of Bitcoin Halving Events
The original reward per block before the 2012 halving was 50 bitcoins per block. The following months saw Bitcoin’s price soaring from $10.59 a coin to $126.24 within 180 days of the halving, which is about +8,547%.
Following that, it went from 25 to 12.5 Bitcoins per block in 2016. The event established Bitcoin as a viable investment and a real possibility in people’s minds, generating more awareness of the asset. The price peaked at over $1002.92 in 2017.
The following halving after the second halving raised the verification reward to 6.25 per block in 2020. Between 2020 and 2021, Bitcoin reached an outstanding all-time high of $14,849.09 within 180 days, a shocking 659% increase.
The most recent halving brought the harvest to 3.65 BTC per block in 2024 as of April 19th.
Future Implications and Investment Strategies
For investors and bitcoin enthusiasts, the attraction of halving lies in the aftermath occurring on the market. If history is any indicator of future behavior. After each halving event, the supply of new bitcoin increases. This drives high demand and results in higher prices. It exhibits a clear pattern, like in 2012, 2016, and 2020.
About 180 days after the Bitcoin halving, Bitcoin experienced dramatic high demand, which sent prices flying to new heights. (The Bitcoin Halving is Here: What Does it Mean for Investors?) Many savvy investors have noticed the trend and are capitalizing on post-halving hysteria.
The question is: Will history repeat what happened a fourth time?
As patterns repeat, there are no guarantees in the cryptocurrency sphere. But history suggests that the halving can spark another bullish spike. Considering the new supply of bitcoin and rising demand by big institutions, it’s not wishful thinking to expect the price to soar to all-time highs. Even considering the massive opportunity, it comes with as much risk. Yet for those with a healthy risk appetite, the potential gains are life-changing.
