The Bitcoin Halving is the most important recurring event for Bitcoin. Every four years, it sparks both excitement and heated debates around whether it really matters or not. And investors worldwide are asking themselves the one and only question; is now a good time to buy bitcoin? As the Bitcoin Halving 2024 approaches, let's take a look at those questions.
WHAT IS BITCOIN HALVING?
Bitcoin's inception in 2009 represented a paradigm shift in how we perceive and transact value. The decentralized, peer-to-peer nature of the first cryptocurrency is what makes it unique. To pull this amazing feat off, Bitcoin relies on a process known as Bitcoin mining. Highly specialized computers add new transactions to the Bitcoin network. For this effort, miners are rewarded with newly minted bitcoins. However, this reward doesn't stay constant. Roughly every four years ,or more specifically, every 210,000 blocks, this reward is cut in half. This event is known as bitcoin Halving,
HOW ARE BITCOIN HALVING IMPACTING THE BITCOIN PRICE?
Historically, the Bitcoin Halving has been a significant event regarding Bitcoin's price action. Reducing rewards for miners cuts the inflow of new Bitcoins into the market. This scarcity, combined with a constant or increasing demand for Bitcoin, typically creates upward pressure on the price. And, of course, there is a psychological effect. Many people turn more optimistic before and around Halving events.
Substantial bull runs followed previous Bitcoin Halving in 2012, 2016, and 2020. it's important to note that many other factors can influence Bitcoin's price. Including global economic conditions, regulatory news, technological advancements, and market sentiments. The correlation between BItcoin Halving events and bitcoin price surges is powerful,but not necessarily causative.
WHAT CAN WE LEARN FROM PREVIOUS BITCOIN HALVING?
The current Bitcoin Halving cycles started in may 2020. it's only third one, since the genesis cycle that started in January 2009, and cycle 1 and 2, which started in November 2012 and july 2016. the most impressive returns were delivered during cycle 1; Between November 2012 and july 2016, Bitcoin delivered a staggering 9915 percent return of 2949 percent in cycle 2 and 704 percent (So far in cycle 3.