Bitwise: Market Underestimates Long-Term Impact of Upcoming Bitcoin Halving

As the Bitcoin halving approaches on April 20, Bitwise Asset Management highlights that while immediate post-halving price actions are subdued, historical data suggests significant long-term gains.

Navigating Bitcoin's Halving: Immediate Stability Belies Potential Long-Term Surge

According to Bitwise Asset Management, the price of Bitcoin fluctuated little in the month following previous halvings, but it increased significantly over the next year.

The Bitcoin halving is just days away, planned for April 20, but market movement in the month after the highly anticipated event has historically been disappointing, according to Bitwise Asset Management.

In an April 16 X post, Bitwise observed past price movement in the month following the Bitcoin halving, noting that the previous three halvings saw its price decline — but in the following year, its price increased by at least triple-digit percentage points.

Bitcoin gained 9% in the month following its halving in 2012, but it increased by 8,839% during the next year.

A similar pattern emerged after the 2016 halving: bitcoin dipped 10% the next month before rising 285% to $20,000 in 2017. Again, in 2020, it had a 6% price increase in the month after halving, followed by a 548% increase the following year.

“The data is limited, but the picture reveals an intriguing pattern. The market prices in the short-term impact of the halving but underestimates the long-term impact,” Bitwise wrote.

The current market cycle marks the first time Bitcoin has reached an all-time high before halving.

The cryptocurrency reached its latest top of $73,679 on March 13 and fell 16% to a low of $61,500.

Industry executives are also negative in the immediate term. On April 13, Markus Thielen, head of research at 10x Research, projected that the halving might result in a $5 billion miner sell-off, putting negative pressure on markets.

Market Trends: Analyzing Correction Patterns and Predictions Amid Crypto Fluctuations

Meanwhile, Marathon CEO Fred Thiel stated that the halving rally had already been factored in, pushing forward what would have been a post-halving surge.

On April 16, trader and analyst Rekt Capital published a list of market correction magnitudes since the 2022 bear market bottom on X.

Five substantial declines, ranging from 18% to 23%, occurred. Currently, markets have corrected 16%, implying that more may come.

Fellow expert Cold Blooded Shiller remarked that 30% corrections were not uncommon, implying that Bitcoin may fall to roughly $51,000.

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