Anticipations are high among crypto traders for the upcoming Bitcoin halving event in 2024, as it is expected to have a significant impact on the crypto market. However, analysts at Steno Research believe that it will follow the pattern of a “buy the rumor, sell the news” event.
In the history of Bitcoin, there have been three halving events. The first halving occurred in 2012, reducing miner rewards from 50 BTC to 25 BTC. The second halving took place in 2016, reducing the rewards to 12.5 BTC. The most recent halving occurred on May 11, 2020, reducing the rewards to 6.25 BTC.
Steno Research predicts that the next Bitcoin halving will resemble the 2016 halving, where selling pressure continued for four months after the event. Despite the increased anticipation from Bitcoin ETF holders, the research firm expects a short-term “buy the rumor, sell the news” scenario.
According to Steno Research, BTC’s value is likely to surge leading up to the halving event. However, they also anticipate a dip in value within the first 90 days following the halving, potentially falling below the price at the time of the halving.
Analysts at Steno Research have identified similarities between Bitcoin’s price performance before and after the 2016 halving, suggesting that similar outcomes can be expected this time. The report highlights that Bitcoin’s price remained below its pre-halving level for the entire 90 days following the halving, with a specific 8.4% decrease on the 90th day.
Data from CryptoQuant shows that Bitcoin daily mining rewards are currently at their highest ever, indicating that although the number of BTC issued will be the smallest after the halving, their value in dollars will be high due to the current price level. This suggests that miners are likely to sell their Bitcoin over time to cover mining costs, contributing to selling pressure and a correction in BTC’s price.
However, the report also mentions that once the selling pressure from miners reduces, the halving becomes a bullish catalyst for Bitcoin’s price. Analysts believe that the halving event will trigger a repricing, causing the price to surge. They argue that even though people are aware of the halving event, its full impact is never fully priced in.
While some short-term volatility is expected post-halving, the overall sentiment is bullish, with expectations of strong interest and growth in the wider Web3 ecosystem.
As of the time of publication, Bitcoin was trading at $71,563, indicating a 3.8% increase in the last 24 hours.
Please note that this article does not provide investment advice or recommendations. Readers should conduct their own research and make informed decisions when it comes to investing and trading.