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Cryptocurrency exchange Coinbase today released a critical report on Bitcoin halving. The report states that the cryptocurrency does not operate in a vacuum and its price is also affected by external factors such as macroeconomic influences. The report, which includes comments on Bitcoin‘s price, emphasized BTC‘s strong performance.
What’s in the Bitcoin Halving Report?
The report notes that Bitcoin has gained 61% in value in the last six months and 348% in the following six months, highlighting the significance of the halving effect in the crypto world. However, Coinbase analysts indicate that this relationship is still speculative. Despite the hypothesis that halving could have a positive effect on Bitcoin’s performance, there is no definitive proof.
The halving event, known as the reduction of mining rewards by half, is seen to affect Bitcoin approximately every four years. The next halving is expected to occur on April 15th.
Coinbase emphasizes that Bitcoin is not only affected by its internal dynamics. The report explains how Bitcoin’s price is also influenced by other factors, such as macroeconomic factors, the Covid-19 pandemic, and monetary policy easing.
Recent Bitcoin Rally Linked to This Factor
The report states that the main factor behind the recent rally is not halving excitement but expectations for spot Bitcoin exchange-traded funds (ETFs). According to the Coinbase report, this situation emerges as a factor that further increases the price of the cryptocurrency Bitcoin.
The report also emphasizes the importance of the Bitcoin supply held by long-term holders. It is stated that long-term holders are unlikely to see halving as a strong selling opportunity. This suggests that Bitcoin is a solid long-term investment. Lastly, the Federal Reserve is expected to cut interest rates and reduce its quantitative tightening program. According to the report, this could create a favorable environment for risky assets.
What’s the Current Status of Bitcoin Price?
Bitcoin, the flagship of cryptocurrency units, saw a drop to $60,775 yesterday before rising again following the Federal Reserve’s interest rate decision.
Bitcoin climbed to $68,270 overnight. At the time of writing, we see that the BTC price has pulled back slightly. The cryptocurrency BTC is trading at $67,065.
