According to Bybit’s Hao Yang, while the halving is linked to Bitcoin bull cycles, ETF inflows are primarily responsible for the current surge.
Since its most recent halving in 2020, the price of Bitcoin has increased by almost 650%. In the event that history repeats itself, Bitcoin might hit $435,000 before the 2028 halving.
According to TradingView data, the price of Bitcoin has increased by over 658% since its last halving in 2020 and is presently trading at around $66,000.
Less than three weeks will pass until the 2024 Bitcoin halving takes place. If past chart patterns hold true, the price of Bitcoin, which is currently $66,000, would halve to $434,280 per coin in 2028 if the current cycle continues.
However, over time, the returns from Bitcoin’s post-halving rallies have decreased. Before the initial halving in 2012, the value of Bitcoin grew from almost nothing to $12.50, a rise of more than 12,400%.
After the 2016 halving, the price of bitcoin increased by 5,200% to $650, and by 1,200% to $8,500 after the 2020 halving.
In order to reach the present 658%, Bitcoin’s average price rallies dropped by 45% per cycle.
In the event that this trend of diminishing returns continues, Bitcoin will have a 360% surge in the upcoming cycle, culminating in a price of about $303,600 BTC at the 2028 halving.
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Hao Yang, head of financial products at Bybit, told reporters that the current spike in price of Bitcoin is primarily due to inflows into spot Bitcoin exchange-traded funds (ETFs) and has nothing to do with the impending halving.
From a highly rigorous quantitative perspective, there is no evidence to show a positive association between the price of BTC and the halving event. But there are a lot of ways to interpret history. Of course, my goal is $435,000 by 2028, but I won’t be overly ambitious.
A study analysis by Bloomberg analyst Eric Balchunas on February 26 states that if Bitcoin ETFs surpass gold ETFs, which might happen in the next two years, a six-figure Bitcoin price seems even more likely.
Moreover, the growth rate of Bitcoin ETFs is significantly faster than that of gold ETFs since their inception in 2004. According to Sam Wouters, head of contact at River, Bitcoin is actually “speedrunning” the price of gold, which is five times higher than it was on March 29.
“Bitcoin is essentially just the trajectory of gold speedrun five times.” Bitcoin’s recent ten years appear to be a condensed version of the last fifty years of gold. Seems sense why some folks become sour.
The halving of Bitcoin, occurring approximately every four years, is a pivotal event in the cryptocurrency world. It involves a reduction in the rate at which new Bitcoins are created, cutting the rewards for miners in half.
This scarcity mechanism is designed to mimic the scarcity of precious metals like gold and aims to control inflation.
The halving typically triggers a surge in Bitcoin’s price due to increased demand coupled with reduced supply.
It also serves as a reminder of Bitcoin’s deflationary nature, underpinning its status as a hedge against inflation and a store of value.
Each halving event garners significant attention from investors, analysts, and enthusiasts alike, shaping market sentiments and driving speculation about the future trajectory of Bitcoin’s price.
Conversely, the growing influence of Exchange-Traded Funds (ETFs) presents another transformative force in the realm of cryptocurrency.
ETFs offer a more accessible and regulated route for traditional investors to gain exposure to Bitcoin without directly owning the asset.
By investing in ETFs, individuals can indirectly participate in the cryptocurrency market through their existing brokerage accounts, bypassing the complexities of securely storing and managing digital assets.
The approval and proliferation of Bitcoin ETFs by regulatory authorities mark a significant milestone in the integration of cryptocurrencies into mainstream finance, potentially attracting large institutional investors and further legitimizing Bitcoin as a viable investment option.
As ETFs continue to gain traction, their impact on Bitcoin’s liquidity, volatility, and overall market dynamics becomes increasingly pronounced, potentially reshaping the landscape of cryptocurrency investment in the years to come.
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