Bitcoin Halving: Will More Institutional Investors Join In?

Bittime - The world of cryptocurrency is being enlivened by the presence ofBitcoin Exchange-Traded Funds ( ETF ). This financial instrument makes it easier for institutions to invest in Bitcoin, prompting the question: could the upcoming Bitcoin Halving event in April 2024 further accelerate the trend?

Getting to Know Bitcoin Halving

Bitcoin halving is an event that occurs once every four years, where the block reward for Bitcoin miners is cut in half. These miners play an important role in securing the Bitcoin network by validating transactions. 

In return for their contributions, miners receive rewards in the form of new Bitcoins that are minted every time a new block is added to the blockchain.

Impact of Halving on Bitcoin Supply

Halving significantly limits the circulating supply of Bitcoin. The total number of Bitcoins that will ever exist is limited to 21 million. As block rewards decrease, the rate of new Bitcoin production will slow down. This creates digital scarcity, which in theory could drive Bitcoin prices higher in the long term.

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Expert View: Will Halving Attract Institutional Investors?

Experts in the cryptocurrency field are divided in their views regarding the Halving's impact on institutional investor interest.

• Optimists:

  • Swan Bitcoin's Dante Cook argues that a better understanding of Bitcoin's monetary policy, including the Halving mechanism, will increase Bitcoin's appeal to institutions.
  • Ethan Vera of Luxor Technology Corporation stressed that the Halving demonstrated the resilience of the Bitcoin network even with a reduced “security budget.” He predicts continued institutional interest in Bitcoin as well as companies related to Bitcoin infrastructure.
  • Joe Nardini from B. Riley Securities believes that Halving could be an incentive for institutions who want to buy Bitcoin directly. The halving reinforces the idea that Bitcoin supply will not experience inflation, which is a positive factor for long-term oriented institutional investors.

• Skeptics:

  • According to Ruben Sahakyan of Stifel Financial , the main inhibiting factor for institutional investment today is not Bitcoin supply, but rather regulatory clarity in the cryptocurrency space. Some investors are also cautious due to the Halving's potential impact on Bitcoin miners' profitability and reduced Bitcoin price volatility.

More Than Just Supply: Other Factors Affecting Institutional Interest

Some analysts argue that the Halving's impact on the Bitcoin price may not be as great as in previous events. This is caused by:

• Industry Preparation: The cryptocurrency industry is currently much better prepared than during previous Halvings. Layer 2 technology that enables faster and more cost-effective Bitcoin transactions has advanced rapidly.
• Popularity of Bitcoin ETFs: The presence of Bitcoin ETFs makes it easier for institutions to invest in Bitcoin without having to deal with digital wallets and complicated transaction processes.

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Post-Halving: Impact On Miners and Bitcoin Price

• Impact on Miners: Halving directly impacts the profitability of Bitcoin miners. However, the Bitcoin mining industry has evolved and learned to adapt to the changing landscape. Miners are now exploring alternative sources of revenue, such as transaction fees, to offset the decline in revenue from block rewards.
• Impact on Bitcoin Price: The effect of the Halving on the price of Bitcoin is difficult to predict with certainty. Some analysts predict a post-Halving price spike due to greater shortages. However, several other analysts argue that the impact of the Halving on Bitcoin prices may have already been calculated by the market, so a significant price increase may not necessarily occur.

Conclusion: Halving and the Future of Bitcoin

Although the current presence of Bitcoin ETFs may be more significant in attracting the interest of institutional investors compared to the Halving event, the Halving remains an important event for Bitcoin. The halving confirmed Bitcoin's deflationary monetary policy (reduced supply) and the digital scarcity inherent in this asset. The halving served as a reminder to investors about Bitcoin's fundamental strength, potentially strengthening its position as "hard money" in the future.

Market players need to pay close attention to post-Halving developments and observe how institutional investors respond to this event. Additionally, it is worth noting that clearer regulations and technological developments in the cryptocurrency space will continue to be determining factors when it comes to Bitcoin adoption by institutions.

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How to Buy Bitcoin (BTC) on Bittime

You can buy and sell Bitcoin (BTC) in an easy and safe way via Bittime . Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

Bitcoin (BTC) is available on Bittime with the market pair BTC/IDR . To be able to buy BTC IDR at Bittime, make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. 

Learn the complete guide on how to buy Bitcoin (BTC) on Bittime . 

Monitor price chart movements of Bitcoin (BTC) , Ethereum (ETH) , Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.

Also read:

Mining Bitcoin vs Validating Bitcoin Transactions

What is Bitcoin Halving and How Does It Affect Bitcoin?

Bitcoin Halving 2024: What Will Happen to the Miners?

DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.