The cryptocurrency market was eagerly awaiting bitcoins halving on Friday a change to the cryptocurrencys underlying technology designed to cut the rate at which new bitcoins are created.
The halving, which happens roughly every four years, was written into bitcoins code at its inception by pseudonymous creator Satoshi Nakamoto as a way to reduce the rate at which bitcoins are created.
Chris Gannatti, global head of research at asset manager WisdomTree, which markets bitcoin exchange-traded funds, called the halving one of the biggest events in crypto this year.
According to CoinGeckos countdown clock, the halving is scheduled to happen in the early hours of Saturday SAST.
For some crypto fans, the halving will underscore bitcoins value as an increasingly scarce commodity Nakamoto capped bitcoin supply at 21 million tokens while sceptics see it as little more than a technical change talked up by speculators to inflate the virtual currencys price.
' READ: Bitcoin bubble talk grows louderBitcoin and other cryptocurrencies have been supported by excitement around the US Securities and Exchange Commissions decision to approve spot bitcoin exchange-traded funds in January, as well as expectations that central banks will cut interest rates.
Price ralliesPrevious halvings occurred in 2012, 2016 and 2020. Some crypto fans point to price rallies that followed them as a sign that bitcoins next halving will boost its price, but many analysts are sceptical.
We do not expect bitcoin price increases post halving as it has been already priced in, JPMorgan analysts wrote this week. They expect bitcoins price to fall after the halving, because it is overbought and venture capital funding for the crypto industry has been subdued this year.
Financial regulators have long warned that bitcoin is a high-risk asset, with limited real-world uses, although more have begun to approve bitcoin-linked trading products.
Andrew ONeill, a crypto analyst at S P Global, said he was somewhat sceptical of the lessons that can be taken in terms of price prediction from previous halvings. Its only one factor in a multitude of factors that can drive price.
Bitcoin has struggled for direction since Marchs record high and fallen in the last two weeks as geopolitical tensions and expectations central banks will keep rates higher for longer unnerved global markets. Elizabeth Howcroft, (c) 2024 Reuters
