A new research report from crypto analytics firm CryptoQuant suggests that the upcoming Bitcoin halving will not have as significant an impact on the price as many investors expect. According to the report, the diminishing effect of the halving is due to a decrease in the new issuance of Bitcoin relative to the selling of Bitcoin by long-term holders. Instead, the key driver of Bitcoin’s price following the halving will be the increase in demand from investors with large holdings of Bitcoin. The report reveals that demand from whales holding between 1,000 and 10,000 Bitcoin has reached its highest ever level, with 11% month-on-month growth. This increase in demand is significant, as it comes at a time when the supply of Bitcoin is being reduced. However, the report suggests that the current gap between supply and demand is much larger than in previous instances, indicating that the halving’s effect on the price may not be as powerful this time around. Long-term holders are currently accumulating about seven times more Bitcoin per month than the new Bitcoin entering circulation. The report also notes that the total issuance of Bitcoin has dropped to only 4% of the total available supply, a much smaller proportion compared to previous halvings. In conclusion, the report suggests that while the Bitcoin halving may still have some impact on the price, it may not be as significant as in the past.
CryptoQuant: Demand becomes key driver as influence of Bitcoin halving on price diminishes