Why it’s a buy signal for investors.

On April 20, Bitcoin will halve its expectations. This quadrennial event will halve mining rewards, and the next one will reduce rewards to 3.125 BTC per block.

The timing of the reversal is particularly noteworthy as it appears to be in the midst of a bullish trend in Bitcoin's price. Analysts speculate that this halving could significantly affect Bitcoin's trajectory in the coming years.

Is now the best time to buy Bitcoin?

Bitcoin is up 67% in the first quarter of 2024, driven primarily by increased demand for Bitcoin exchange-traded funds (ETFs). The previous high price growth now prompts discussions about the potential impact of Bitcoin's halving.

Some analysts argue that Bitcoin is undervalued, foreseeing a potential rise to $100,000 within a year. Assets' impressive performance so far, combined with expected rate cuts from the Federal Reserve, make this forecast plausible.

“We could see a short correction, but when central banks ease monetary policy, that should drive both direct Bitcoin sales and ETFs because Bitcoin behaves like a tech stock or a speculative value, generally looking at the gains from easing monetary policy. My guess is Bitcoin 100,000 to 150,000.” The dollar could arrive after 12 to 18 months, Adlunam co-founder Jason Fernandez told BeinCrypto.

On the contrary, other experts suggest that the market is already halving. However, with the supply of Bitcoin dwindling and demand driven by Bitcoin ETFs increasing, some see the current time as favorable for Bitcoin investment.

Read more: Bitcoin Half Countdown

NYDIG researchers argue that the impact of the Bitcoin price halving may be small compared to the impact of ETF demand. Therefore, they estimate that a daily supply of approximately 450 BTC will not exert much pressure on the price.

“While the clearing event may not act as an immediate price catalyst, historical data shows that it plays a significant role in shaping Bitcoin's price cycles. Typically, there is a halving lead followed by significant returns after an event. With the current positive price performance pre-half, investors have reasons to be optimistic about Bitcoin's future potential,” writes NYDIG's Greg Cipolaro.

However, historical data shows a percentage increase after each halving. After the first half, Bitcoin rose from $13 to $652, a staggering 4,802% increase. Subsequent halves of the percentage increases have declined, this time hinting at a similar pattern.

Read more: Bitcoin price prediction for 2024/2025/2030

Still, Fernandez told BeCrypto that Bitcoin's post-halving performance varied due to various macroeconomic events.

“The Bitcoin halving event of 2012 saw limited investment by tech-savvy individuals and good communities. In the year In 2016, we saw greater awareness of Bitcoin as an alternative currency that can withstand economic instability. The pandemic year of 2020 was a bit of an outlier as the halving was offset by a dire overall financial situation. In total. I would say that the effects of the halving tend to be evenly distributed among the macro-economic factors that were prevalent at the time,” Fernandez explained.

Advanced views underscore the broad consensus that, while the immediate impact of the halving on BTC's price may be debatable, the event is critical in setting the stage for future price cycles. However, the main impact of this phenomenon can be seen in the increasing energy costs on the profitability of the miners.

However, insights from IntoTheBlock indicate that miners' earnings, measured in USD, are currently at an all-time high, fueled by the rising price of Bitcoin. If the halving results in further price appreciation, the reduced rewards could have negligible effects on miners.