NE BUSINESS BUREAU
CHENNAI, APRIL 20
Bitcoin, the world’s largest cryptocurrency, has recently undergone its much-anticipated “halving,” a significant event occurring roughly every four years. The fourth Halving happened at a time when the crypto prices remained unstable amidst macroeconomic and geopolitical uncertainties.
Following the halving, Bitcoin’s market performance remained relatively stable, experiencing a slight decrease of 0.47% to settle at $63,747.
- Part of the economic impact of the halving has likely already occurred, with investors buying Bitcoin in anticipation of the event, spurred by the approvals of BTC ETFs by the USA, Brazil, and now Hong Kong: Himanshu Maradiya, Founder & Chairman, CIFDAQ Blockchain Ecosystem Ind Limited
Enthusiasts of Bitcoin eagerly awaited this event, which marks a pivotal change in the cryptocurrency’s underlying technology aimed at reducing the rate of new Bitcoin creation. Satoshi Nakamoto, the pseudonymous creator of Bitcoin, incorporated the halving mechanism into the cryptocurrency’s code from its inception.
For some proponents of cryptocurrency, the halving underscores Bitcoin’s value as an increasingly scarce asset. Nakamoto had stipulated a finite supply of 21 million tokens for Bitcoin. However, sceptics perceive the halving as merely a technical alteration hyped by speculators to artificially inflate the virtual currency’s value.
The halving process entails reducing the rewards received by cryptocurrency miners for creating new tokens, thereby making it costlier for them to introduce new Bitcoins into circulation.
Himanshu Maradiya, Founder & Chairman, CIFDAQ Blockchain Ecosystem Ind Limited, said, “Part of the economic impact of the halving has likely already occurred, with investors buying Bitcoin in anticipation of the event, spurred by the approvals of BTC ETFs by the USA, Brazil, and now Hong Kong. This time, the economic circumstances surrounding it are different. It’s the first time that Bitcoin has peaked before a halving, as opposed to after. Post-halving, due to reduced supply and increased excitement about Bitcoin’s potential, more people are buying in. This increase in demand causes the price to rise, further fueling interest in a self-reinforcing cycle. Adding to this, over the last two months, multiple jurisdictions including the USA, Brazil, UK, and Hong Kong have either approved BTC ETFs or are in the process of approval. This will lead to a rush of institutional money and endorsement as an alternative asset class. In the near future, as almost all developed countries approve BTC ETFs, we anticipate that the price of Bitcoin will be governed by demand emerging from the flow of funds through ETFs, which will be sustainable in the long run. Summing up all these positive factors, get ready for the bull run. This time may be a continuous one, not only for 15-18 months post-halving. While we cannot expect the same percentage gain as in the last three halvings, a positive market and bullish sentiments will likely sustain.”
Parth Chaturvedi, Investments Lead, CoinSwitch Ventures said, “Today, we are at the cusp of Bitcoin’s era. The network is getting better utilised as Layer 2 solutions like Stacks bring broader adoption for the network. Other innovations like new token standards (Runes) and the re-staking of Bitcoin will also propel the ecosystem forward. If the landscape changes as anticipated after today’s halving event, it could ‘for the first time’ drive BTC’s annual inflation rate below that of gold. Such a scenario holds transformative potential, particularly among the younger generation, who may increasingly view Bitcoin as a modern-day store of value akin to how preceding generations regarded gold. This shift in perception could fundamentally reshape investment attitudes and strategies for years to come.”
Manhar Garegrat, Country Head India & Global Partnerships at Liminal Custody Solutions said, “The upcoming 4th Bitcoin halving may not be immediately discernible, there are several second-order effects to consider. Past halvings have often triggered heightened market volatility and increased trading activity. This time, we anticipate similar dynamics, potentially leading to price fluctuations and shifts in investor sentiment. The Bitcoin halving could influence the price of Bitcoin due to its increased scarcity leading to upward price pressure and influx of new investors in the crypto market. In addition to the potential impacts on altcoins, it’s worth considering the possibility of new products being introduced into the crypto market. Just as spot ETFs are being launched around the world, innovative financial instruments may emerge in response to the dynamics surrounding the Bitcoin halving offering investors alternative avenues for exposure to digital assets.”
