Another reason some are optimistic about the future of crypto markets is the upcoming Bitcoin halving event in April/May 2024. The idea is that this event, which reduces the supply of new bitcoins, could lead to a higher bitcoin price. However, according to the JPMorgan analysts, the halving event is already priced in.
"This argument seems unconvincing as the bitcoin halving event and its effect are predictable and in our opinion are well factored into bitcoin price," they said.
"For example, looking at the bitcoin production cost after the halving event using current hash rates and difficulty would suggest that the production cost would rise from $21,000 currently to around $43,000. However, the current price at around $35,000 would be consistent with around a 20% drop in the hash rate as miners in higher cost locations or with less efficient hardware exit the market, which seems reasonable to us. This suggests that the halving event could already be largely in the price."
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Another reason some are optimistic about the future of crypto markets is the upcoming Bitcoin halving event in April/May 2024. The idea is that this event, which reduces the supply of new bitcoins, could lead to a higher bitcoin price. However, according to the JPMorgan analysts, the halving event is already priced in.
"This argument seems unconvincing as the bitcoin halving event and its effect are predictable and in our opinion are well factored into bitcoin price," they said.
"For example, looking at the bitcoin production cost after the halving event using current hash rates and difficulty would suggest that the production cost would rise from $21,000 currently to around $43,000. However, the current price at around $35,000 would be consistent with around a 20% drop in the hash rate as miners in higher cost locations or with less efficient hardware exit the market, which seems reasonable to us. This suggests that the halving event could already be largely in the price."
www.theblock.co/post...rally-looks-overdone