Crypto community begins Bitcoin halving countdown as milestone date nears
The CEO of Binance and BTC analysts are among those who have started to draw attention to the halving event as the crypto community looks to the bullish event with hope after a cruel crypto winter.
The crypto community and many of its most high-profile players have started to shift focus toward the Bitcoin halving, an event that occurs every four years and cuts the market supply of new Bitcoin (BTC) in half. With the next halving event scheduled for April 2024, the Bitcoin mining reward will reduce from the current 6.25 BTC per block to 3.125 BTC per block.
Binance CEO Changpeng Zhao took to Twitter to set the countdown for the next halving in an X (formerly Twitter) post to remind everyone that the next BTC halving event is only 135 days away.
#Bitcoin halving soon. pic.twitter.com/xp4mWyMKkD
— CZ Binance (@cz_binance) November 19, 2023
Historically, the Bitcoin halving is linked to bullish momentum for the BTC price due to supply and demand dynamics. The halving of new supply amid growing demand usually pushes the BTC price to new highs in the months following the halving.
During the last bull cycle, which started with the halving in May 2020, the BTC price traded under $10,000 almost two months before the halving. However, pre-halving bullish momentum saw BTC’s price surpass the previous cycle’s all-time high of around $17,000. After the halving, the BTC price broke into parabolic momentum and touched a new all-time high of almost $69,000.
Popular trader and analyst Rekt Capital also took to X to elaborate on the different phases of a BTC bull cycle. The analyst divided the timeline into pre-halving and post-halving events, highlighting that approximately 60 days before the halving, a pre-halving rally tends to occur as investors tend to “Buy the Hype” to “Sell the News.”
However, the euphoric price surge in the pre-halving period is usually followed by a retrace around the time of the actual halving. In 2016, the pre-halving retrace was -38%, while the 2020 pre-halving retrace was -20%.
The pre-halving retrace is often followed by a multimonth reaccumulation phase when the BTC price rises further. Many investors get shaken out in this stage due to boredom, impatience and disappointment with the lack of major results in their BTC investment in the immediate aftermath of the halving.
The accumulation phase is followed by the parabolic surge, in which Bitcoin breaks out from the re-accumulation area to touch new highs. During this phase, Bitcoin experiences accelerated growth on its way to new all time highs.
