As Bitcoin prepares for its fourth halving in mid-April 2024, the expectations are shocking. This event is more than just a milestone for crypto miners. It is a tectonic shift that resonates throughout the ecosystem. This topic isn't just about miners. It's about how this event will impact every corner of the crypto world, including the growing Bitcoin ETF sector.
Let's dig into the details of this pivotal moment to uncover what it means for Bitcoin ETFs.
1. Bitcoin Halving: The Basics
Bitcoin halving is a special event in the Bitcoin system that occurs approximately every four years. The next halving, the fourth in Bitcoin history, is expected to occur around April 19-21, 2024. During the halving, the number of new Bitcoins miners receive for processing transactions will be halved. Currently, a miner gets 6.25 Bitcoins per block, but after the upcoming halving he will reduce to 3.125 Bitcoins. This reward reduction is built into Bitcoin's protocol to control Bitcoin's supply and ensure scarcity, making Bitcoin a deflationary asset over time.
The impact of this event will be felt throughout the Bitcoin ecosystem, including the Bitcoin ETF space.
2. Definition of Bitcoin ETF
A Bitcoin exchange-traded fund is an investment fund that tracks the price of Bitcoin. These allow investors to gain exposure to Bitcoin without directly owning it.
There are two types of Bitcoin ETFs: Bitcoin Spot ETF and Bitcoin Futures ETF.
- Bitcoin Spot ETF It holds real Bitcoin and reflects its price movements.
- Bitcoin futures ETFOn the other hand, you invest in a Bitcoin futures contract, which is a contract to buy or sell Bitcoin at a predetermined price in the future.
Both types allow investors to trade Bitcoin on traditional stock exchanges, reducing the risk of direct Bitcoin ownership while providing liquidity and accessibility.
3. Impact of Bitcoin Halving on Bitcoin ETFs
The impact of the Bitcoin halving on ETFs will vary depending on their underlying assets and operating mechanisms.
In the case of spot ETFs that hold Bitcoin directly, the halving could slow down the creation of new Bitcoins, increasing their scarcity and increasing the value of Bitcoin. As a result, spot ETFs can offer higher returns for investors.
Conversely, futures ETFs that trade Bitcoin futures contracts may be indirectly affected by the halving through changes in market sentiment and price trends. However, the impact is expected to be less immediate and direct than for spot ETFs.
Given the potential for spot ETFs to be more impacted in the short term, it is essential to analyze the major Bitcoin spot ETFs to assess their current situation.
Four. Technical Analysis of Top Bitcoin Spot ETFs
Top players in the Bitcoin spot ETF space dominate by assets under management, including Grayscale (GBTC), BlackRock (IBIT), Fidelity (FBTC), Ark/21 Shares (ARKB), and Bitwise (BITB).
| Bitcoin Spot ETF | price | 20 days MA | MACD15 period | Williams % range 20 days | RSI 20th | the ultimate oscillator |
| GBTC | $56.38 | $60.38 | -4.74 | 55.56 | 49 | 49 |
| ibit | $36.08 | $38.64 | -3.04 | 88.43 | 49 | 49 |
| FBTC | $55.36 | $59.29 | -4.66 | 88.30 | 49 | 49 |
| ARKB | $63.31 | $67.80 | -5.33 | 87.92 | 49 | 49 |
| BITB | $34.51 | $36.97 | -2.92 | 88.43 | 49 | 49 |
Analyzing the top 5 Bitcoin Spot ETFs using indicators such as 20 Day MA, MACD 15 Period, Williams % Range 20 Days, RSI 20 Days, and Ultimate Oscillator reveals some interesting insights.
Grayscale GBTC current price is $56.38, below its 20-day moving average of $60.38, and has a negative MACD of -4.74. The Williams % Range (20 days) is 55.66, and the Relative Strength Index and Ultimate Oscillator are both 49.
BlackRock IBIT price is $36.08, below its 20-day moving average of $38.64 and has a MACD of -3.04. Williams % Range is noticeably higher at 88.43, but RSI and Ultimate Oscillator both remain at 49.
Fidelity’s FBTC is showing a similar pattern, with its price at $55.36 and MACD at -4.66, below its 20-day moving average of $59.29. Williams % Range is 88.30, while RSI and Ultimate Oscillator are both 49.
ARK/21 stock ARKB price is $63.31, below its 20-day moving average of $67.80 and has a MACD of -5.33. Williams % Range is 87.92 and RSI and Ultimate Oscillator are both 49.
Finally, Bitwise’s BITB price is $34.51, below its 20-day moving average of $36.97 and MACD of -2.92. Williams' % range is 88.43. RSI and Ultimate Oscillator both remain at 49.
To be precise, the top five ETFs are all currently trading below their 20-day MAs, indicating a short-term bearish trend. However, the Williams % Range suggests some movement in the oversold situation, and the MACD is showing negative momentum.
4.1. Predicting the technical status of top Bitcoin spot ETFs after Bitcoin halving
After the Bitcoin halving, the technical landscape for these ETFs could change significantly. A decrease in Bitcoin's supply could change the price trend and affect Bitcoin's position relative to the 20-day moving average. Additionally, changes in market sentiment after the halving could influence oversold conditions and negative momentum.
Endnotes
As Bitcoin approaches its fourth halving, scheduled for mid-April 2024, the impact on Bitcoin ETFs remains a topic of intense interest. These halving events, which occur once every four years, not only adjust the rewards for Bitcoin miners, but also complexly shape the dynamics of Bitcoin supply and scarcity. As a result, the value of Bitcoin ETFs, whether spot or futures, is in limbo awaiting the outcome of this transformative event.
