Bitcoin Halving: Scarcity and Bull Run
Bitcoin Supply Growth Set to Drop Below 1%
Bitcoin’s supply growth is poised to dip below 1% for the first time ever during the upcoming halving event, highlighting the cryptocurrency’s scarcity premium. This event is expected to fuel the current bull run, especially as institutional investors show interest in holding onto Bitcoin.
The Impact of Halving Events
Halving events occur every four years and cut the amount of Bitcoin produced on the blockchain by miners in half. The next halving event will reduce the block reward from 6.25 BTC to 3.125 BTC, slowing down the minting of new Bitcoin and increasing its scarcity and price.
Bitcoin’s Evolution and Future
As Bitcoin approaches the 21 million coin limit, concerns arise about miners’ incentives for network upkeep. However, emerging use cases beyond simple transactions, like NFTs and layer-two technologies, offer new revenue streams for miners through transaction fees.
Bitcoin Halving History
Previous halving cycles have shown distinct price movements in Bitcoin across pre-halving, halving, and post-halving periods. The 18-month period post-halving has historically seen significant price peaks, with the current cycle expected to reach its peak in October 2025.
Institutional Investment in Bitcoin
The entry of institutional investors into the Bitcoin market, marked by the launch of spot Bitcoin ETFs, has injected significant capital. Funds like Blackrock’s iShares Bitcoin Trust and Fidelity’s Fidelity Wise Origin Bitcoin Fund have amassed over $60 billion in assets under management.
The Future of Bitcoin
Despite concerns about miners’ incentives post-full circulation, innovations like layer-two technologies are poised to enhance Bitcoin’s utility and security. Leveraging Bitcoin’s network for complex programs presents a promising avenue for future growth and adoption.
