Bitcoin Price Soars as Halving Approaches
On March 13, the price of Bitcoin reached an all-time high of $73,000. The price increased nearly $20,000 (nearly 50%) in the month of February alone, the greatest monthly gain in Bitcoin history. With fewer than 30 days until the Bitcoin Halving, market sentiment seems confident that this bull market will drive Bitcoin into six-digit USD price territory. Anything short of that would be a disappointing surprise. The only real question is whether the price will break $100,000 before or after the Halving.
The Bitcoin price, set by buyers and sellers on hundreds of digital asset exchange platforms operating around the world, is always influenced by a multitude of factors. Each previous Bitcoin bull market was correlated in time with the four-year Bitcoin Halving cycle, which demonstrates the immense influence of Bitcoin’s coin distribution schedule on the price. All indications currently suggest that the upcoming 2024 Bitcoin Halving, when the block reward will be cut from 6.25 BTC to 3.125 BTC, is replicating the same pattern and will continue to do so.
The influence of Bitcoin’s coin distribution schedule, cutting the block reward in half every four years, has been an ever-present factor in each previous Bitcoin bull market, and it will continue to be a driving force in 2024 and future cycles. But there are additional factors that are unique to this four-year bull market cycle. One of the most significant of these factors is the introduction of several new Bitcoin ETFs in the United States, which have already facilitated the flow of tens of billions of dollars into Bitcoin since they started trading in January. By simplifying investment in Bitcoin to a process as straightforward as purchasing stock through any brokerage account, these ETFs have opened the doors for retirees managing their nest eggs, busy professionals seeking portfolio diversification, and millennials eager to profit from Bitcoin without the complexity of managing a self-custodial crypto wallet.
Another significant factor driving the price of Bitcoin is new demand and investment from innovative nation-states such as El Salvador and Bhutan. This trend of nation-state Bitcoin adoption is only just beginning; it is possible, even likely, that many others are already accumulating secretly. The potential investment from sovereign entities is virtually unlimited.
Whether the price of Bitcoin breaks $100,000 before or after the Halving is not so important. It will happen eventually. What’s important is having a sufficient amount of your investment portfolio allocated to Bitcoin so that you capitalize on this once-in-a-century growth opportunity, while also balancing risk and reward.
