The crypto market is entering a critical phase as the U.S. Securities and Exchange Commission (SEC) is expected to make a decision on the approval of a spot Bitcoin ETF, with the Bitcoin halving event also approaching. Historically, halving has significantly impacted Bitcoin’s price, often leading to substantial increases compared to pre-halving levels.
Past Bitcoin halving events have shown remarkable price surges. After the first and second halvings between 2012-2016, Bitcoin’s price soared by 5187%, followed by a 3000% increase in the subsequent four years after the 2016 halving.
Similarly, a year after the 2020 halving, Bitcoin reached an all-time high of $69,000. These patterns suggest that halvings have been a major catalyst for capital inflows into the crypto market and have spurred price rallies for Bitcoin and altcoins.
Bitcoin halvings, which occur every four years, aim to reduce miner rewards by half, thus decreasing the rate of new Bitcoin creation and increasing mining difficulty. The 2020 halving reduced miner rewards from 1,250 to 625 units, with the upcoming event expected to further decrease rewards to 312.5 units.
Amid these developments, analysts are making predictions ahead of the spot Bitcoin ETF decision. CrediBULL Crypto suggested that if Bitcoin surpasses $45,500 before the final decision date of January 10, 2024, an upward price movement could accelerate. Conversely, a negative outcome could lead to another drop to around $38,000 to $40,000. Reports also indicate that the Bitcoin ETF could start trading as soon as the next business day following approval. Meanwhile, Bitcoin’s price has started the new week neutrally, hovering around $43,946 with little change.