Bitcoin (BTC) was trading at $66,074 on Tuesday, slightly higher than the previous day's price. coin desk The data showed. The fourth Bitcoin halving took place on Friday, after which the rate of new Bitcoin issuance decreased to 3.125 every 10 minutes.
It is a little surprising that Bitcoin is trading at a subdued price after the halving. Experts explain that prices were already rising before the halving. In fact, this is the first time in Bitcoin's history that the price increased before an event.
On Tuesday, Ethereum traded at $3,180, BNB at $605, and Solana at $154. coin desk report.
Halving means that the issuance rate is halved. Halving refers to changes to the cryptocurrency's underlying blockchain technology aimed at reducing the pace of new Bitcoin creation.
There can only be 21 million Bitcoins in existence, so if there are fewer new Bitcoins, this can affect the price of Bitcoin.
Also read: Bitcoin falls 8% in 5 days.Here are four reasons behind the sharp decline
The slowdown in price increases after the halving seems to be a result of prices being factored in.
Parth Chaturvedi, head of investments at CoinSwitch Ventures, believes the market has already priced in the halving, so there were no big moves near the event.
“Geopolitical tensions have pushed prices down from recent highs overall, but we expect downward pressure in the near term as miners and ecosystem participants adapt to new supply dynamics. The fourth halving will result in BTC's annual inflation rate being lower than that of gold, further encouraging investors to explore Bitcoin as a 'store of value' asset class.” Stated.
layer 2 token
Shivam Thakral, CEO of BuyUcoin, believes that layer 2 tokens are outperforming Bitcoin. “Since the long-awaited halving, there has been no noticeable rally in Bitcoin, but Bitcoin Layer 2 tokens have outperformed Bitcoin. More and more Bitcoin Layer 2 projects will be innovative in the coming weeks.” These tokens have the potential to outperform the market even further as we launch unique scalability solutions,” said Thakral.
Industry insiders also believe that the price of Bitcoin in 2024 will be determined by external factors.
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“Past examples of Bitcoin price spikes following halvings have often coincided with major macroeconomic events such as the 2012 European debt crisis, the 2016 ICO boom, and the 2020 COVID-19 pandemic. It has become clear that economic conditions have a wide-ranging impact on the virtual currency market, and the trajectory of the Bitcoin price in 2024 will be influenced by external variables such as geopolitical tensions and economic fluctuations. Technological advances will also play an important role. Continued adoption rates and other demand forces will also impact the price,” said Sumit Gupta, Co-founder of CoinDCX.
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