In designing what would become the world's largest blockchain network, Satoshi Nakamoto decided to include an event held approximately every four years to set a constant inflation rate for the creation of new BTC.
The so-called halving would reduce the rewards miners receive for their work on the network by half, which theoretically means that if demand remains the same or increases, the price of the underlying asset will rise. It should be.
With BTC's next halving just around the corner, one analyst has outlined a particularly simple but perhaps very profitable strategy for those who want to speculate on Bitcoin's price movements with respect to each cycle.
History shows that the price of Bitcoin actually increases in the months following a halving. It remains to be seen if it's all hype or if people are actually buying more while production rates are slowing down. However, every new low is higher than the previous cycle's low, leaning towards the latter.
Mags, a popular crypto analyst at
According to their graph, the price of BTC bottoms out approximately 500 days before each halving and peaks 500 days after the halving completes.
The last time it happened was in May 2020, when Bitcoin soared to an all-time high of $69,000 19 months later (or just over 500 days).
After that, a large-scale bear market occurred, and major cryptocurrencies dropped significantly to around $15,000 from late November to December 2022. The fourth half-life should occur within a few weeks, meaning the half-life would be completed 16 to 17 months (about 500 days) after the half-life. The bottom of a bear market.
Some predictions for this cycle, as previously reported, are for BTC to reach $150,000 or perhaps $200,000 in the year following the next halving.
Still, it must be said that this strategy is for those who aim to speculate on the price movements of BTC before and after each halving. Bitcoin HODLers tend to disagree and are constantly accumulating.
Additionally, history is no guarantee of future price movements, so investors should do their own research before delving into any investment. If you want to learn more about Bitcoin halving, watch the video below.
