The bitcoin halving in 2024 is just two days away, and there are already different expectations about what could happen to the btc price once the event is complete. However, one way to get an idea of how it could affect the price of bitcoin is through historical data and how the cryptocurrency has performed in times like these.
bitcoin Price Trends for Previous Halvings
There have been three halvings so far since bitcoin was first launched in 2009 and with each of them, bitcoin has shown various reactions to the event. The first halving took place on November 28, 2012, the second on July 9, 2016 and the last on May 11, 2020.
For the purposes of this report, only the last two halvings will be referenced, as adoption had begun to increase by the time these two occurred. The 2016 halving occurred when bitcoin was trading around $650, but in the weeks following the halving, the price of btc would fall another 30%, reaching as low as $460 before rising again.
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btc price crashed 30% post-halving in 2016 | Source: Tradingview.com
Then during the 2020 halving, btc price was trending just under $10,000 and after the halving it would also see a drop in price. However, this drop was not as significant as the 2016 drop, and the btc price only fell by around 15% during this time.
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btc price crashed 15% post-halving in 2020 | Source: Tradingview.com
This has formed a huge trend with the halving, where the price of bitcoin falls after the event, which is expected to be bullish. Therefore, if this trend continues, btc could see a sharp drop in price despite the expectation that the halving will be bullish for the price.
However, it is important to note that subsequent halvings have seen a smaller post-halving drop compared to their predecessors. So if this holds true this year, bitcoin could still be facing a decline, but to a much lesser degree. For example, the 2020 post-halving drop was half of the 2016 post-halving drop, so if this trend holds, the drop this time could only be around 7-8%.
btc Deviates from Established Halving Trends
While historical data suggests where bitcoin could be headed after the crash, it is also important to note that the digital asset has deviated from a number of pre-halving trends. One of these deviations is the fact that the price of bitcoin reached a new all-time high before the halving, something that has never happened before. This could suggest that there will be a complete departure from these established trends, meaning that a drop may not occur after the halving after all.
Another deviation is that the few weeks leading up to the last two bitcoin halvings have been green. However, in 2024, the last three weeks leading up to the halving have been red as the price of btc has declined. This also lends credence to the fact that there could also be a deviation from its post-halving trends.
However, one thing to keep in mind is that the cryptocurrency market has always been uncertain and bitcoin has a habit of doing what no one expected. The bitcoin Fear & Greed Index has seen a pullback from extreme greed territory, but remains in greed, meaning investors remain bullish. In this case, if bitcoin did the opposite of what was expected, then it could follow the established trend and fall again.
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btc deviates from pre-halving trend | Source: BTCUSD on Tradingview.com
Featured image from Adobe Stock, chart from Tradingview.com
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