Coinbase’s recent report indicates the next Bitcoin halving, scheduled for mid-April 2024, could have a substantial impact on the market.
The reduction of miners’ block rewards from 6.25 BTC to 3.125 BTC is expected to influence Bitcoin’s price significantly.
Historical impact on Bitcoin’s price
The report highlights that previous halvings have led to significant price increases, with an average rise of 61% in the six months leading up to the event and 348% in the following six months.
However, the effect of each halving varies, and not all have led to dramatic surges.
External factors and long-term holder behavior
Coinbase cautions that halving events don’t operate in isolation. Factors like monetary policies and macroeconomic conditions also play crucial roles.
Additionally, the behavior of long-term holders, who tend to hold onto their Bitcoin during halvings, contributes to the asset’s stability.
Current market dynamics
With Bitcoin up 157% since mid-October, there’s optimism in the market.
Yet, Coinbase advises caution, emphasizing the need to consider broader economic factors, including potential actions by the U.S. Federal Reserve and impacts from bankrupt digital asset lenders.
Coinbase claims that people should not rely solely on the halving event but also consider other market influences.
