Bitcoin seen surging to $450,000 — if this halving trend plays out

The Bitcoin halving is expected this week and everyone’s asking one question: What will it mean for the price of the cryptocurrency?

Noelle Acheson, author of the “Crypto is Macro Now” newsletter, said that based on previous cycles Bitcoin could soar as high as $450,000 over the next year.

However, she also warned that there will be more “brutal” weeks ahead.

Other analysts warned that global instability — such as the escalating conflict between Israel and Iran — could hold back gains.

Bitcoin price

The halving has been baked into the cryptocurrency’s programming since Sataoshi Nakamoto, the mysterious creator of Bitcoin, launched the cryptocurrency some 15 years ago.

It will occur when block number 840,000 is created, which is estimated around April 20.

It will slash miners’ rewards for minting new Bitcoin by half — from 6.25 Bitcoin to 3.125 — which will reduce supply and, in theory, increase the coin’s value.

Historically, the price of the world’s largest cryptocurrency has surged on the back of the previous three halvings.

Citing Bloomberg data, Acheson noted that Bitcoin’s price surged 8,691% one year after the 2012 halving, 295% after the 2016 event, and 559% after the 2020 event.

If those patterns repeat, then Bitcoin could reach $450,000 a year from now, or $270,000 if this cycle turns out to be more like 2016, Acheson said in an April 13 newsletter.

Different this time around

Acheson also noted that “this cycle is obviously different” as this is the first time Bitcoin reached a record before a halving.

In the previous two cycles, it took more than 500 days for the cryptocurrency to set a new record after the halving.

“Does that mean the time to the next all-time high will be much shorter than in previous cycles?” Acheson asked. “Could it imply a steeper correction after the event? There’s no way to tell, especially with so many other market drivers at work.”

Le Shi, head of trading at market maker Auros, told DL News the launch of new US spot Bitcoin exchange-traded funds has introduced a new crop of investors, which “serves as the primary driver behind recent price gains.”

Middle East

The comments come as Bitcoin has shed 8.3% of its price over the past seven days to trade at $66,270.

It dropped as low as $62,697 on April 13, according to CoinGecko.

The day “sure was brutal in markets, and I wouldn’t be surprised if there are more days like that ahead,” Acheson said.

The drop came amid tensions in the Middle East, that escalated with Iran attacking Israel.

“Global instability and persistent inflation continue to stymie a full-on bull run, with Bitcoin halving pricing in current sentiment and arriving flat,” Jehan Chu, founder of venture capital firm Kinetic Capital, told DL News.

Not priced in

Acheson also rejected some analysts’ assumptions that the halving won’t impact Bitcoin’s price this time because people have known about it for a long time.

But that would assume that both markets are efficient and everyone knows about the event.

“Both are obviously not true,” Acheson said. “All crypto investors know for sure is the supply side of the halving impact: there will be fewer new BTC entering the market.”

Crypto market movers

• Bitcoin rose by 3.4% in the past 24 hours and is trading at $66,270.
• Ethereum skyrocketed 7.3% to $3,250.

What we’re reading

• Bitcoin recovers some of steep losses after Iran strikes Israel — DL News.
• Coinbase Files Interlocutory Appeal In SEC Case — Milk Road.
• Why (Almost) Everyone in Ethereum Is So Excited About a Wallet-Related Proposal — Unchained.
• Security Engineer Gets 3-Year Prison Term For Hacking Decentralized Crypto Exchanges — Milk Road.
• This is where options traders bet Bitcoin’s price will land after the halving — DL News.

Sebastian Sinclair is a markets correspondent for DL News. Have a tip? Contact Seb at sebastian@dlnews.com.