Crypto community begins Bitcoin halving countdown as milestone date nears
2 min read
The crypto community and many of its most high-profile players have started to shift their focus toward the Bitcoin halving, a 4-year cyclic event that cuts the Bitcoin market supply in half. With the next halving event scheduled for April 2024, the Bitcoin mining reward will reduce from the current 6.25 BTC per block to 3.125 BTC per block.
Binance CEO Chang Peng Zhao took to Twitter to set the countdown for the next halving in an X (formerly Twitter) post to remind everyone that the next BTC halving event is only 135 days away.
#Bitcoin halving soon. pic.twitter.com/xp4mWyMKkD
— CZ Binance (@cz_binance) November 19, 2023
Historically, Bitcoin halving is also linked to bullish momentum in BTC price owing to the supply-demand dynamics where the halving of the supply amid growing demand pushes the BTC price to new highs just around the halving time.
During the last bull cycle, which started in 2020 with the halving in May 2020, the BTC price traded under $10,000 almost two months before the halving period. However, the pre-halving bullish momentum saw BTC price surpass the previous cycle’s all-time high of around $17,000. After halving, the BTC price broke into parabolic momentum and touched a new all-time high of over $69,0000.
The technical analysts with the ‘X’ profile name ‘Rekt Capital’ also took to Twitter to elaborate on the different phases of a BTC bull cycle. The analysts divided the timeline into pre-halving and post-halving events, where they pointed out that approximately 60 days before the halving, a pre-halving rally tends to occur as investors tend to “Buy the Hype” to “Sell the News.”
However, this euphoric price surge in the pre-halving period is followed by a retrace around the time of the actual halving. In 2016, the pre-halving retrace was -38% while this pre-halving retrace was -20%.
The pre-halving retrace is followed by a multi-month re-accumulation phase when the BTC price starts to accumulate further. Many investors get shaken out in this stage due to boredom, impatience and disappointment with the lack of major results in their BTC investment in the immediate aftermath of the halving.
The accumulation phase is followed by the parabolic surge, in which Bitcoin breaks out from the re-accumulation area to touch new highs. During this phase, Bitcoin experiences accelerated growth on its way to new all time highs.
