The crypto market is currently trading sideways as Bitcoin's fourth halving approaches in the next 19 days. However, historical data reveals a compelling trend, with Bitcoin experiencing significant price increases of between 800% and 8,000% during each previous halving.
With the upcoming fourth halving scheduled to see the block reward reduced from 6.25 BTC to 3.125 BTC, expectations are high on how Bitcoin will react to this pivotal event.
Bitcoin historical performance
Prominent crypto investor EvanLuthra.eth has drawn attention to Bitcoin's historical performance following previous halving events. These halvings play an important role in maintaining Bitcoin's scarcity and increasing its long-term value.
Since its inception in 2009, Bitcoin has experienced three halvings, all of which caused significant price increases.
First half-life, 8000% gain
The first halving occurred on November 28, 2012, when the block reward was reduced from 50 BTC to 25 BTC. Bitcoin's price then skyrocketed from about $12 to more than $1,000 in less than a year, a staggering 8,000% increase.
Second half-life, 3,000% gain
After the second halving on July 9, 2016, when the block reward was reduced from 25 BTC to 12.5 BTC, the price of Bitcoin skyrocketed from $660 to over $17,000 within a year and a half, an astonishing 3,000%. showed a significant increase.
Third half-life, 800% gain
The third halving, which took place on May 11, 2020, further reduced the block reward from 12.5 BTC to 6.25 BTC. Bitcoin's price rose from about $8,600 to over $67,000 in less than a year, reflecting a massive 800% increase.
What is the fourth half-life?
Now, as the fourth halving approaches, expectations are rising among crypto enthusiasts and investors. Market dynamics are expected to change again with the block reward halving from 6.25 BTC to 3.125 BTC. However, the unique maturity of today's crypto market adds an element of unpredictability to the equation.
What effect does half-life have?
Despite the uncertainty, expectations are rising about Bitcoin's performance after the halving and the ripple effects on other cryptocurrencies. It is predicted that if new Bitcoin issuance decreases from the current 900 BTC per day to around 450 BTC per day, there will be a supply shortage, which could increase demand and price.
As the countdown to April 20, 2024 continues, investors remain vigilant and ready to take advantage of the potential opportunities in the ever-evolving crypto market.
