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Business News/ Markets / Cryptocurrency/  Bitcoin hovers around $66,000 in global crypto markets post-halving
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Bitcoin hovers around $66,000 in global crypto markets post-halving

Halving means the rate of issuance is cut in half. Since there can only be 21 million bitcoins

Industry insiders also believe that the halving event is already factored in bitcoin prices Premium
Industry insiders also believe that the halving event is already factored in bitcoin prices

Bitcoin (BTC) trades at $66,074 on Tuesday, marginally higher than its price a day ago, CoinDesk data showed. The fourth bitcoin-halving took place on Friday, following which the issuance rate of new bitcoin dropped to 3.125 every 10 minutes.

It is a little surprising that bitcoin is trading at muted prices post-halving. Experts explain this by saying that the price had already risen prior to the halving. In fact, it’s the first time in Bitcoin history that the price had increased before the event. 

Ethereum on Tuesday traded at $3,180, BNB at $605 and Solana at $154, CoinDesk reported. 

Halving means the rate of issuance is cut in half. The halving refers to an alteration in the foundational blockchain technology of this cryptocurrency, aimed at decreasing the pace of generating new bitcoins.

Since there can only be 21 million bitcoins, and when newer bitcoins are fewer in number, this is likely to impact bitcoin prices.

ALSO READ: Bitcoin falls 8% in five days; here are 4 reasons behind the plunge

The muted price rise after halving is seen as a result of the price already factored in.   

Parth Chaturvedi, Investments Lead, CoinSwitch Ventures believes that the markets have already priced in the halving, because of which there was not any major volatility close to the event. 

“Broadly prices are lower from their recent highs due to geopolitical tensions, but we can expect near term downward pressure as Miners and ecosystem participants adjust to the new supply dynamics. The 4th halving brings BTC’s annual inflation to less than gold’s and will further push investors to explore it as ‘store of value’ asset class," said Chaturvedi. 

Layer-2 tokens

Shivam Thakral, CEO of BuyUcoin believes that layer 2 tokens have outperformed bitcoin. “While Bitcoin had no significant gains since the highly-anticipated halving, Bitcoin layer 2 tokens have outperformed Bitcoin. These tokens could further outperform the market as more and more Bitcoin layer 2 projects launch their innovative scalability solutions in the upcoming weeks," says Thakral.

Industry insiders also believe that the bitcoin prices in 2024 will be determined by external factors. 

ALSO READ: Bitcoin Halving: World's biggest crypto reaches supply milestone, trades over 58 lakh

“Past instances of Bitcoin price surges following halvings have often coincided with major macroeconomic events, such as the 2012 European debt crisis, the 2016 ICO boom, and the 2020 COVID-19 pandemic, underscoring the broader impact of economic contexts on crypto markets. The trajectory of Bitcoin prices in 2024 will be impacted by external variables such as geopolitical tensions, economic fluctuations, and technological advancements will also play a significant role. Ongoing adoption rates and other demand influencers will also impact the price," says Sumit Gupta, co-founder, CoinDCX.

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Published: 23 Apr 2024, 07:24 PM IST
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