Bitwise Warns: Crypto Market Failing To Grasp Full Potential Of Bitcoin Halving

Bitwise Asset Management notes that after previous Bitcoin halvings, the price remained stagnant for a month but surged significantly in the subsequent year.

Bitwise Asset Management stated that despite the highly anticipated Bitcoin halving, which is scheduled for April 20 with Bitcoin trading at $63,368, historical data indicates that price movement in the following month has often been underwhelming.

Bitwise observed in an April 16 post that following the past three Bitcoin halvings, the price experienced a decline in the month following the event. However, over the subsequent year, it recorded significant gains, reaching triple-digit percentage increases.

Following the 2012 halving, Bitcoin saw a modest 9% increase in the subsequent month. However, over the course of the following year, it experienced an extraordinary surge of 8,839%.

The 2016 halving saw a comparable trend: Bitcoin decreased by 10% the month after, but then surged by 285%, reaching a peak of $20,000 in 2017. Similarly, after the 2020 halving, there was a 6% price increase in the month following, followed by a remarkable 548% increase over the subsequent year.

“The data is limited but the picture reveals an intriguing pattern,” Bitwise wrote. “The market prices in the short-term impact of the halving but underestimates the long-term impact.”

This market cycle marks the first instance where Bitcoin reached an all-time high before its halving event.

Bitcoin achieved its recent peak of $73,679 on March 13 but has since experienced a 16% correction, dropping to a low of $61,500.

Short-term sentiments among industry leaders are equally negative. Markus Thielen, Head of Research at 10x Research, predicted on April 13 a potential $5-billion miner sell-off post-halving, exerting downward pressure on markets.

Marathon CEO Fred Thiel suggested that the halving rally had already been priced in, accelerating what would have typically been a post-halving surge.

Trader and analyst Rekt Capital shared on X a list of market correction magnitudes since the 2022 bear market bottom on April 16.

Five notable pullbacks, ranging from 18% to 23%, have occurred. With the current correction at 16%, it is suggested that there may be further downward movement.

Additionally, analyst Cold Blooded Shiller observed that 30% corrections were not unusual, suggesting that BTC might decline to approximately $51,000.

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