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bitcoin is scheduled to experience the hotly anticipated halving event. a little over 24 hours As of this writing, it is halving the rewards offered to Bitcoin miners and slowing down the rate of new coin creation.
Restricting supply sounds like a move that would spark a market rally, but America’s largest bank says it’s not that simple. In a Thursday note cited by Bloomberg, JP Morgan analysts said the oldest and largest digital assets are already overbought.
“We do not expect the price of Bitcoin to rise following the halving as it is already priced in,” they concluded. bloomberg.
The financial giant added that a lack of venture capital funding in the cryptocurrency space will also contribute to the decline in BTC value.
that much bisector This is an event baked into the Bitcoin code. It is based on the steady progress of blockchain expansion, but basically occurs every four years.
mine worker—the large-scale work of processing transactions on the network—is rewarded with Bitcoin in return for minting new coins. On Saturday, the reward for each block processed will be reduced from 6.25 BTC to 3.125 BTC.
This means miners have to work more efficiently to remain profitable. According to a JP Morgan report, larger companies can withstand these changes.
“Listed Bitcoin miners are well-positioned to take advantage of the new environment, primarily due to increased access to financing, particularly equity capital,” the report said. “This will help us expand our operations and invest in more efficient equipment.”
This also means that there will be less Bitcoin available on the market. Some industry observers say: trust The long-term price of the asset will rise.
Others, including JP Morgan analysts led by Nikolaos Panigirtzoglou, say markets have already absorbed the potential impact of the halving.
Bitcoin prices plummeted last Friday and continued to fall this week. large scale liquidation In the futures market, the Middle East war and comments from Federal Reserve Chairman Jerome Powell led to selling.
that much bitcoin price The current price is $63,476, down 9% in seven days, according to CoinGecko data. Last month, it hit an all-time high of $73,737 per coin.
From experts in the field decryption Not only is volatility and large price drops expected ahead of a halving, it has happened every time.
Edited by Ryan Ozawa.
