New York investment bank Morgan Stanley suggests that bitcoin is slowly entering a bull market.
Bitcoin halving
Morgan Stanley bases its analysis on the fact that the bulk of the rise in bitcoin always occurs after a halving.
As a reminder, the halving takes place every four years. This is the halving of the number of bitcoins created with each block. Miners will soon get 3.125 bitcoins per block, compared to 6.25 bitcoins today.
The report entitled “Will Crypto Spring Ever Come?” »Morgan Stanley estimates that the next halving should take place in April 2024.
The precise date depends on the evolution of the computing power (hashrate) of the network. As the halving approaches, miners tend to push to the maximum the inefficient machines which will become unprofitable following the halving. However, the higher the computing power, the faster the blocks are found.
Morgan Stanley also notes that bitcoin’s low point occurs 12 to 14 months after its high. The last high ($68,000) was in November 2021 and the lowest was actually reached a year later.
For analyst Denny Galindo, “a 50% rise in the price of bitcoin from its lowest level is generally a good sign that the bottom is a thing of the past.”
In other words, the bull run is well and truly underway given that bitcoin is already up 70% since the start of the year, and 77% compared to the last low reached last November.
The bulk of the increase occurs directly after the halving, writes Mr. Galindo. This “bullish period begins with the halving and ends when the price of bitcoin reaches its previous high”.
“The planned limitation of the supply of bitcoins may popotentially raise the price of bitcoin »he added. “There have been three such increases since its inception. VSeach having lasted from 12 to 18 months in the wake of the halving.
In short, the planets are aligning. ETFs will boost demand at the same time as halving will lower supply. What will be the next ATH? $100,000, $200,000?
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