Halving Impact on Supply and Demand
Bitwise CEO Hunter Horsley predicts that the upcoming Bitcoin halving in April 2024 will have a significant impact on supply and demand. During the halving, the block reward for miners is reduced by half, which leads to a decrease in the token’s supply.
Horsley points out that the previous halving in 2020, when Bitcoin’s price was around $9,000, resulted in a supply reduction of ~$9 million per day and ~$3 billion per year. However, with Bitcoin’s current price around $70,000, Horsley estimates that the supply reduction will be over three times greater, at ~$32 million per day and $11 billion per year.
Reduced Selling Pressure and Increased Institutional Demand
Horsley believes that the reduced supply will lead to less natural selling pressure from miners. Additionally, he notes that the halving will coincide with an increase in institutional demand for Bitcoin.
Price Surge Expected
These factors indicate that Bitcoin is likely to experience a significant price surge following the halving event. Horsley had previously predicted that Bitcoin could reach $250,000 sooner due to increased investor demand driven by the introduction of the Bitcoin spot ETF.
Current Market Overview
At the time of writing, Bitcoin is trading at $70,000, with a slight loss on the day. The monthly chart shows a 10.45% gain, and the market cap is $1.1 trillion, making Bitcoin the largest cryptocurrency in the world.
