As the crypto community’s milestone day approaches, the Bitcoin count begins to halve

The crypto community and many prominent players have begun to focus on the Bitcoin halving, which occurs every four years and cuts the market supply of new Bitcoin (BTC) in half.

In the event of the next halving scheduled for April 2024, the Bitcoin mining reward will decrease from the current 6.25 BTC per block to 3.125 BTC per block.

Binance CEO Changpeng Zhao took to Twitter to set up a countdown to the next BTC split in X's (formerly Twitter) post to remind everyone that the next BTC halving event is only 135 days away.

#Bitcoin will soon be halved. pic.twitter.com/xp4mWyMKkD

— CZ Binance (@cz_binance) November 19, 2023

Historically, the Bitcoin halving has been associated with bullish momentum for the BTC price due to supply and demand volatility. The halving of new supply while demand is growing will cause the price of BTC to move to new highs in the months following the halving.

Two months before the last halving event in May 2020, the price of Bitcoin was trading at less than $10,000. As the event draws closer, the price of BTC has seen an increase of around $17,000 from the previous cycle. After the halving, BTC price entered a parabolic trajectory and formed an all-time high near $69,000.

Renowned trader and analyst Rect Capital took to X to explain the various stages of the BTC bull cycle. The analyst split the timeline into pre-halving and post-halving events, highlighting that 60 days before the halving, there will be a pre-halving rally as investors “sell the news” and “buy the halving”.

However, the euphoric price increases in the pre-halving period are often reversed around the time of the actual halving. In the year In 2016, the pre-half recovery was 38%, the pre-half of 2020 was again 20%.

A pre-half return usually follows a months-long rally in which the price of BTC rises and falls with little profit. Many investors at this stage cringe due to boredom, impatience and the frustration of seeing their BTC investment halved.

The accumulation phase is followed by a typically parabolic surge, during which Bitcoin rises from its accumulation area to a new high. During this phase, Bitcoin experienced rapid growth on its way to new all-time highs.