The new report of Coinbase, the largest American digital currency exchange, showed that the impact of the Bitcoin halving event on the performance of this asset is not yet clear; Because several other external factors play an important role in market behavior.
Having is considered a positive event; Because it is believed to increase the potential scarcity of Bitcoin and support its supply-demand dynamics. Getting a clear picture of market reaction requires removing the effects of movements in the US dollar, interest rates, and global liquidity.
Bitcoin halving occurs every four years. During this event, the Bitcoin mining block reward will be reduced by 50%.
David Duong, Head of Institutional Research at Coinbase, emphasized in the report that removing the impact of global liquidity on Bitcoin’s price behavior gives a clear picture of how the asset performs in different economic regimes.
Duong said that as the next halving approaches, it’s important to note that the current increase in global liquidity masks a direct impact on Bitcoin’s price behavior; Because the crypto market has been following global liquidity movements since the adverse events that occurred in May and June 2022.
Coinbase research chief added:
We think that the next bitcoin halving in the second quarter of 2024 may have a positive effect on the performance of this coin. However, based on the evidence, this effect is speculative.
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