Bitcoin’s price has entered into a bullish trend. And investors worldwide are in a frenzy to benefit as much as possible from this upsurge. Bitcoin’s value just crossed $50,000 for the first time in two years. Besides, the biggest cryptocurrency’s market cap crossed $1 trillion after a long time.
The surge has been fueled by investor interest due to Bitcoin’s upcoming ‘halving’. The cryptocurrency recorded a straight seven-day price rise, which was another major feat in recent times.
As mentioned earlier, Bitcoin seems to be on its path to regain its past glory from November 2021 and most likely go beyond its highest value of $69,000.
Bitcoin has recently made a massive recovery after falling to just $16,000 in 2022.
There are many factors at play here.
What is Cryptocurrency Halving?
‘Halving’ involves the automatic reduction of the rate at which new coins enter circulation. It is a feature in a cryptocurrency’s infrastructure. For Bitcoin, this process takes place around every four years and plays a big role in pushing its price high.
The following points should simplify the reasons behind the halving process:
- There is a cap on how many bitcoins can eventually be created or mined. Bitcoin’s founder put this limit at 21 million coins. It is this limitation that offers the cryptocurrency its value. However, some experts claim that it is a ‘manufactured’ limitation and has no real-world impact on a cryptocurrency’s value.
- Halving helps in keeping inflation under control. It also helps incentivize miners. When inflation falls, bitcoin’s scarcity increases, and so does the price.
Bitcoin’s halving is expected to take place in April of 2024.
Why Investors Are Enthusiastic about Bitcoin Halving?
There are many reasons why Bitcoin investors are eager about the halving process. Consider the following statistics:
- In 2014, Bitcoin’s price rose by 30,000% compared to its price in 2010. This was because Bitcoin was halved in 2012.
- The growth after the 2016 halving was 800%.
- The figure was 700% after 2020 halving.
According to market pundits, this event creates significant volatility yet the market perception is bullish.
Spot Bitcoin ETFs
This time Bitcoin halving will be taking place at a unique time. The US Securities and Exchange Commission (SEC) has recently approved around 20 spot Bitcoin ETFs. Led by major institutional investors, BlackRock and Fidelity, the newly launched funds have already raised $10 billion in inflows.
This is another factor that has created a massively positive sentiment for Bitcoin growth in the current atmosphere. With these key factors being active currently, high-spirited bullish action and striking sell-offs are expected to be seen before and after BTC halving.
Bitcoin Regains its $1 Trillion Market Cap
Bitcoin has also regained the $1 trillion market cap. We had previously predicted the likeliness of BTC regaining its $1 trillion market cap. The last time, the cryptocurrency did this was in late 2021. It is worth noting that the global crypto market cap currently stands at $1.92 trillion. Bitcoin accounts for more than 50% of that amount.
With the current market sentiment and the major factors at play, it wouldn’t be an overstatement to claim Bitcoin is on its way to topple its previous all-time high price. It wouldn’t even be a surprise if BTC touched the magical price figure of $100,000 in 2024 itself.
The next one to two years are going to be big for Bitcoin and the general crypto market!
