The fourth Bitcoin halving is now finished and crypto investors I’m impatiently waiting for the result in terms of the price of Bitcoin and other cryptocurrencies. As the largest crypto asset, the price of most altcoins is largely correlated with that of Bitcoin, making the halving event very important for all investors.
The just-concluded Bitcoin halving presents a buying opportunity for crypto investors, according to Matt Hougan, CIO of crypto index fund provider Bitwise Asset Management.
Does Bitcoin Halve a “Buy News” Opportunity?
Bitcoin halving events are highly anticipated in the crypto world. Speaking in an interview with CNBC Squawk BoxHougan noted that Bitcoin prices would rise significantly after the halving, making it a “buy the news” event, especially when considering the long term.
Hougan then analyzed Bitcoin’s price action in the months following the halving, noting how the asset’s price increased significantly in the year following the last three halvings. Hougan attributes this price increase to the supply crisis in the months following the halving.
“The amount of new Bitcoin supply coming to market is cut in half. We are cutting $11 billion in annual supplies. I think overall it has to be good value for money and that’s what I would expect over the next year,” Hougan said.
When asked about the potential for Bitcoin to be used as store of value in the middle of geopolitical tensionsparticularly in the Middle EastHougan noted that crypto’s capacity is best seen as a whole.
“If you look at the big picture, it’s done a great job of protecting us against post-COVID inflation. I think ultimately this will be a good hedge against geopolitical disruption,” Hougan said.
Total crypto market cap currently at $2.339 trillion. Chart: TradingView
What’s next for Bitcoin?
THE recently concluded the Bitcoin halving saw rewards given to miners reduced from 6.25 BTC to 3.125 BTC. The idea and design behind each halving is quite simple. With fewer new bitcoins entering circulation, existing bitcoins could become more valuable. In each of the three previous halvings, the price of Bitcoin fluctuated in the first few months, but ended up being much higher a year later.
For example, the price of Bitcoin persisted for at least nine months after the 2020 halving before ultimately experiencing a 458% price increase. If history were to repeat itself, a similar 450% rise would place the price of Bitcoin around $345,000 in the first quarter of 2025.
At the time of writing, Bitcoin is trading at $64,870. Bitcoin is currently up more than 130% in the annual period leading up to the just-concluded halving. A similar increase of 130% over an annual period after the halving places the price of Bitcoin around $150,000 by mid-2025.
Interestingly, this price range best suits Anthony Scaramucci, founder of SkyBridge Capital, who predicted the price of BTC would reach at least $170,000 by the end of the current market cycle.
Featured image from Pixabay, chart from TradingView
