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With the Bitcoin halving on the horizon and the tantalizing tease of a BTC spot ETF, the crypto waters are bubbling with anticipation. But what's the real deal behind the halving? How does it impact miners, and what ripple effects might it have on the broader Bitcoin ecosystem?
And let's not forget the recent media frenzy around BlackRock's rumored iShares spot Bitcoin ETF approval. Was it just a flash in the pan, or a sign of bigger waves to come? As deadlines pass and heavyweight fund houses jostle for a piece of the BTC spot ETF pie, we ponder the inevitable: is it a matter of "if" or "when"?
But, as always in the crypto-verse, there's a twist. Could the very predictability of these events be their undoing? Join us as we unravel these threads, weigh the risks, and serve up our signature blend of insights and ICYMI moments. Remember, in the world of crypto, it's always best to buy the rumor and sell the... well, tune in to find out!
Will 2024 start a bull run for Bitcoin?
There are two push factors we are looking at:
- Bitcoin halving
Bitcoin halving is a programmed event that occurs roughly every four years, halving the rewards miners receive for adding new blocks to the blockchain.
This process was crafted to control Bitcoin's supply, limiting excessive inflation into the BTC ecosystem. The initial reward started with 50 BTC and currently stands at 6.25 BTC.
|Halving Date||Reward||$$ Halving Day||180 Days After|
|28 Nov 2012||25 BTC||$12.20||$42.00|
|09 Jul 2016||12.5 BTC||$650.96||$1050.51|
|11 May 2020||6.25 BTC||$8,755.54||$14,821.06|
|*April 2024||3.125 BTC||let your imagination run wild🐸|
The significance of Bitcoin halving lies in its ability to maintain a stable, reduced supply of new coins, thereby contributing to the cryptocurrency's security and value. Furthermore with the halving it further introduce scarcity which drives investors appetite.
From a miner's point of view, halving miner rewards incentives them to be competitive and thus rives away less productive miners. This, in turn, can impact the overall security and decentralization of the network.
Here if we think about it, what if miners leave the network, because there are less rewards? Then BTC is over. Actually, if miners leave, the mining difficulty will drop and that that will make mining more profitable, leading to other miners to start. Bitcoin mining difficult is also an essential part of the Bitcoin mining process, contributing to various aspects that enable the Bitcoin network to function successfully. Unchained Crypto delves into this here.
- Bitcoin spot ETF
We all know about the recent incident: jumping on rumoured news shared on Telegram, excited journos at Cointelegraph were quick to report that the SEC had approved Blackrock's Ishares spot Bitcoin ETF. This caused a spike in BTC price.
The above shows us that public are anticipating an approval and is excited about it.
Moreover, many heavyweight fund houses want a piece of the BTC Spot ETF action.
The first and second deadline has passed, and there is still no approval yet. The decision for the spot approval by the SEC has been moved to 2024.
It is not a matter of "if," but "when."
So when you put these two together. BTC Halving and BTC sport ETF approval. You get what you think you might get.
However, there's a counterpoint worth considering. The predictability of the halving event and its historical impact on price raises a valid concern. If investors foresee a price surge post-halving, they might start buying Bitcoin now and plan to sell around April 2024, hoping to cash in on the anticipated price boost. This pre-emptive buying could potentially lead to a price surge before the actual halving, followed by a sell-off around or post the halving event.
Such behavior could alter the traditional post-halving price trajectory, illustrating how market dynamics might adapt to widely anticipated events. AKA buy the rumor sell the NEWS.
And tune in at the same time next week where we'll discuss the state of stablecoins!
🎙️ Hey there, Blockspace listeners! 🎙️
Before you dive deep into the crypto chaos, here's a little heads-up from your pals at Blockhead. While we love unraveling the blockchain tapestry and sharing our findings, remember, our chats are just that—chats. They're not financial blueprints or crystal balls. So, whether you're a crypto veteran or just dipping your toes, always do your own research and consult with a pro before making any financial moves. After all, in the world of crypto, it's always best to take things with a pinch of satoshi... or salt. Dive in responsibly! 🚀🧂