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Bitcoin vs. Dollar

📌 Nineteen days to go until bitcoin’s half-life – how has BTC behaved in previous cycles? – Compelling.

Nineteen days to go until bitcoins half-life - how has BTC behaved in previous cycles? Bitcoin

– Nineteen days to go until bitcoin’s half-life – how has BTC behaved in previous cycles?

With 19 days to go until bitcoin’s four-year half-life, the market remains unchanged.

This event, which reduces the issuance of new bitcoins from 6.25 BTC to 3.125 BTC per block, has historically been characterized by unprecedented bullish momentum since the end of the year.

However, traders seem unsure of what the next cut will bring, as BTC is up just 2.6% over the past 14 days. Still, according to CoinGecko, bitcoin has maintained most of its gains after soaring to all-time highs since the spot ETF launched in January.

On April 22, 2020, 19 days before bitcoin was last halved, BTC was trading at $6,842 and the market was trading in a mid-range after trading between $6,420 and $7,340 during April 2020.

Bitcoin rose 44% in 17 days to reach a local high of $9,822 on May 9, and opportunistic selling pushed the price back to $8,752 by the third half-life on May 11, 2020. BTC fell to US$8,600 the next day and has never traded lower since.

However, the bullish momentum associated with the third half price reversal occurred in a very different macroeconomic climate. Cryptocurrencies had experienced a sharp decline along with the major markets just a month earlier, when a state of emergency and travel ban was declared in the U.S. in March 2020 due to the Covid 19 pandemic.

On March 17, 2020, bitcoin fell to an 11-month low of $5,030, marking a 51% pullback in less than five weeks. This drop made bitcoin ripe for a rebound before the previous double-digit drop: after seven months, BTC reached an all-time high, in contrast to the five months of bullish momentum before bitcoin’s next double-digit drop, which saw it reach an all-time high.

On June 20, 2016, 19 days before the second halving, the market began to retreat from its pre-halving peak. Bitcoin was trading at $734 after falling 4% in 24 hours, with the price having risen 66% in four weeks in the previous day.

After a second halving on July 9, 2016, BTC fell in value by another 11% to reach a low of $517 on August 2, representing a 29.5% drop since June 20, 2020 and a 21% correction since the halving. Bitcoin reached an all-time high in February 2017, seven months after halving for a second time.

BTC/USD price dynamics in 2016. Source: CoinGecko.

With the total cryptocurrency capital up more than 23,300% from approximately $12 billion as of June 20, 2016, the digital asset sector today is largely unrecognized in terms of its size and penetration.

However, the 2016 cycle shows that bitcoin is not immune to a pullback after sustained bullish momentum.

Bitcoin

Bitcoin

$63,339.50

BTC -3.11%

Ethereum

Ethereum

$3,119.28

ETH -1.22%

Binance Coin

Binance Coin

$557.06

BNB -1.66%

XRP

XRP

$0.50

XRP -1.50%

Dogecoin

Dogecoin

$0.16

DOGE -1.49%

Cardano

Cardano

$0.46

ADA -2.22%

Solana

Solana

$139.67

SOL -7.33%