Why the Halving Isn’t Priced In
Bitcoin halvings, which occur every four years, reduce the rewards miners receive for processing transactions. This reduced supply typically leads to a price increase if demand remains the same or increases.
According to Rekt Capital, a renowned crypto analyst, the market has not yet fully priced in the recent halving that occurred on April 19. Historically, halvings have triggered rallies that have surpassed previous all-time highs.
Post-Halving Phases
Rekt Capital identifies two remaining phases in the current cycle:
- Post-Halving Re-Accumulation Phase: A period of consolidation before a breakout.
- Parabolic Rally Phase:
A rapid price increase.
Current Cycle Deviations
This cycle has exhibited some deviations from past cycles, with new all-time highs occurring 260 days before the halving. This suggests that while historical patterns provide guidance, each cycle can introduce unique dynamics.
Risks and Market Corrections
Rekt Capital warns of potential risks, including an initial rejection after reaching the high range of post-halving prices. Investors should temper their expectations and be prepared for short-term retracements.
Diminishing Returns
While each cycle’s peak has historically been higher than the last, the rate of growth has slowed. Rekt Capital predicts that the explosive growth rates of early cycles may not repeat, but the overall upward trajectory remains intact.
Long-Term Outlook
Despite the risks and diminishing returns, Rekt Capital maintains a bullish outlook for Bitcoin in the long term. He anticipates a parabolic rally phase where gains will come quickly.
