How will the cryptocurrency market react after halving? | Bitcoin and the Crypto Market

21 days ago

We are increasingly excited about how the market will react when the bitcoin halving event arrives. It's not for nothing, but there seems to be much more interest in it than in other opportunities, and rightfully so.

Bitcoin has proven to rise to the occasion, reaching a historical high that is getting closer to the $100,000 mark. However, it remains to be said that there is much work to be done, as we are actually just speculators of this cryptocurrency, but we trust that cryptographic adoption will unfold worldwide at a vibrant pace.

We find ourselves faced with an encouraging outlook. Since April 8th, the volume of BTC has been increasing, marking a rise that started at $19.772 billion and is currently at $32.300 billion.

There seems to be great optimism in the overall cryptocurrency market. This was expressed by Ripple CEO Brad Garlinghouse, who, during an interview with GNBC, stated that the crypto market capitalization will reach 5 trillion by the end of 2024. Currently, we are at a market capitalization of 2.8 trillion dollars and it has grown by 4.1% in the last 24 hours, which is truly remarkable.

If I were to have an opinion on this, it would be that many people can influence with their words an optimal and positive sentiment about Bitcoin and the accompanying altcoins; in this way, the global cryptocurrency market reinforces its visibility and importance in the world of finance, and with every statement made, that positive speculation increases, attracting investors who believe that their investments could potentially grow exponentially in the long term. Looking at it this way, it has proven to be quite true, as if we observe how Bitcoin has behaved over time, despite any downturns along the way, the graph in its entirety shows where it is heading.

At this point it seems clear that since the introduction of exchange traded fund (etf), the market has expanded attracting investors of large sizes to invest and inject a large amount of money into the market. Despite the setbacks that occurred and the countless restrictions to the global acceptance of cryptocurrencies, everything marked a key sense in the growth of a new market that strengthened immensely.

Let's remember that everything depended on the decisions that were communicated to the SEC, until finally the requests were approved and their outcome contributed to seeing levels never before reached in the price of Bitcoin. This benefited the demand in a quite disproportionate way, because if we talk about the supply, it is decreasing in a quite substantial manner which could be something positive, but from my point of view it is not, since it is an indicator of great volatility when one side of the balance weighs more than the other.

I like to believe that growth should be exponential to achieve profits that are considered rewarding, however, it could affect the trajectory that will be set from now on, so it would be best for that growth to be organic and enjoy financial health. By this, I mean to avoid those big falls after a great growth in a short period of time.

Michael Förtsch | Unsplash

Regulations are a topic to discuss. The clarity of them leads to a better interaction of the cryptographic market with society. The good thing is that efforts are being made to stay away from these regulations, and it is expected that in the future, with the change of government, cryptocurrency regulations will have a very positive impact. This is one of the concerns that I want to think we are all trying to address, as it is one of the paths that will allow the expansion of Bitcoin but also of other imposing cryptocurrencies that deserve to have their opportunity like the expected Ethereum ETF for cash.

Regulatory clarity seems to be the main item that the market will have to comply with, even if it means going through a period of regulatory acceptance and denials.

There are exactly 11 days and 18 hours left for the Bitcoin halving to finally arrive. The outlook can be promising; in fact, it is what we are most eagerly awaiting as it means the halving of the rewards of Bitcoin mining blocks.

The issue is that a pattern is emerging that has shown on several occasions (previous halvings) that after a strong surge caused by a buying pressure, it takes at least a year for a drop close to or exceeding 77% to occur. This could be more of a concern than something encouraging, especially assuming that we hold a significant number of assets. However, it seems that this pattern has a reason.

A clear reason could be an attempt to take profits after a long period of time, as investors are strategists and seek to maximize their earnings. On the other hand, it could be corrections to maintain the health and balance of cryptocurrencies, although this could lead to a cryptographic winter, which is when prices tend to drop for several months. Still, there are other markets such as the stock market, which seems to revitalize at a certain point in the year.