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Bitcoin Rally: Which Bitcoin Halving Is Believed to Be Responsible for the Bull Run?
While bitcoin It fell marginally on Tuesday, continues to trade above $52,330. In the last month alone, the cryptocurrency has grown by approximately 26%. Over the past six months, the token has increased by 100%.
There are a number of reasons given for this gathering. One was the recent approval a Spot Bitcoin ETF by the US regulator Securities and Exchange Commission (SEC).
READ ALSO: Bitcoin rises to $50,000 for the first time since 2021 on ETF request
It was followed by the offer of Black rock AND Fidelity.
The second main reason for the ongoing rally is the upcoming bitcoin halving, scheduled for mid-2024.
Edward Snowden, a former contractor for the NSA (National Security Agency), supported the probable surge in the token.
He wrote on Platform X: ““Bitcoin is the most significant monetary advance since the creation of coinage.”
What is Bitcoin halving?
One of the significant events of bitcoin is the halving when the reward for mining is reduced by half. The last halving took place on May 11, 2020, after which network participants who validate transactions are awarded 6.25 bitcoins for each successfully mined block.
The next halving is scheduled for mid-2024, after which the block reward will drop to 3,125 bitcoins.
The final halving will occur in the year 2140 when the number of bitcoins in circulation reaches the supply of 21 million. To date, 19 million bitcoins have been mined, leaving only two million more to be mined.
“One of the most important features of Bitcoin is its limited supply and issuance mechanism,” Forbes quoted Bruce Fenton, CEO of Chainstone Laboratoriesas mentioned.
In order to understand the concept behind validating a transaction, you need to understand how Bitcoin works.
As we are aware that the underlying technology of bitcoin is blockchain which consists of a network of computers called nodes. Each full node is responsible for approving a transaction in the bitcoin network.
To do this, the node checks the validity of the transaction.
It is crucial to note that each transaction is approved individually, and after approval, the transaction is added to the blockchain and broadcast to other nodes.
What does the industry believe?
Most spokespersons of the cryptocurrency industry in India believe that this will be a significant event and will play a key role in giving momentum to bitcoin and other crypto tokens.
“The Bitcoin Halving is proof of the maturity of decentralization. It’s a demonstration of Satoshi’s genius. Halving controls Bitcoin inflation. But rules are not created on the spot, but set in stone and made immutable in code. Like clockwork, every four years… or almost every 210,000 blocks, the algorithm halves the rewards for miners. We are now approaching the fourth halving since the birth of Bitcoin,” says Ashish Singhal, co-founder and CEO of the group, Peepal Co.
Some even believe that the halving would allow Bitcoin to break from its past historic high of $68,789 reached on November 10, 2021.
Vikram Subburaj, CEO, Giottus cryptographic platformstates: “Currently, BTC is consolidating around $52,000 after an exciting run over the past 14 months. BTC is widely expected to surpass its all-time high of $69,000 in the quarter following this year’s halving. Historically, Bitcoin halving events led to bullish momentum in the months before and after the halving.”
Meanwhile, Sumit Gupta, co-founder of CoinDCXstates: “With the halving event just 58 days away, there will be a supply shock while demand continues to grow. This delicate balance between reduced supply and increased demand creates an environment ripe for momentum , signaling the dawn of the next bull run. Anticipation grows as we expect Bitcoin to reach unprecedented highs following the halving, marking another chapter in its extraordinary journey this calendar year.”
“The Bitcoin halving cycle has become synonymous with price appreciation, and all signs point to history repeating itself. However, what sets this cycle apart is the involvement of institutions following the regulatory approval of the Bitcoin ETF and the notable inflow of institutional funds. These developments highlight a maturing market, suggesting that the impending price increase could be even more substantial than in previous cycles,” says Gaurav Mehta, co-founder and CEO of Catax: simple taxes on cryptocurrencies.
“The upcoming halving is another important milestone for investors that is fueling optimism and buying action in the market. It is important to note that liquidity is improving for the overall cryptocurrency market and Bitcoin’s $1 trillion market capitalization is a testament to the resilience,” says Rajagopal Menon, VP, WazirX.
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