The Bitcoin halving. Rush to be disappointed, right on cue, every four years. The digital messiah is coming! Prices will skyrocket! We'll all be rich! Let's pump the brakes here. What I’m seeing, though, is a lot of misplaced faith and honestly a terrifying level of complacency. The halving might bump the price, sure. But to believe it’s a sure path to fiscal glory? That's a delusion.
I’m Haruto, and for the past few years, I’ve been studying market trends and breaking down the world of crypto. As ever, I try to offer a future-oriented view even when doing so is counter to the conventional wisdom. Because right now, the prevailing story about the halving is way too bullish.
Let me tell you three reasons why the excitement behind halving is misguided. Don’t roll the dice on your future!
Halving Ain't A Guaranteed Rocket Ride
Think of the halving like this: it's like reducing the supply of gold being mined. Sounds great, right? Less supply, increased demand, higher price! What if demand suddenly dips? What if people lose interest in gold? The end price would just have to level off or even decrease, no matter how much more is being produced.
It is the underlying point nobody seems to get. As a reminder, the halving event simply reduces the rate at which new Bitcoin are brought into circulation. It does not guarantee increased demand. Without that supply, the demand won’t *magically* show up and make the price skyrocket. On the macro front, we’re witnessing a minor cooling in market sentiment, as evidenced by a decrease of the Crypto Fear & Greed Index. That should be a red flag.
Unexpected Connection: It reminds me of the dot-com bubble. All anybody could see was the “new technology” and the “future of the internet.” In the process, they abandoned all fundamental business logic. Companies with negative revenue and no credible path toward a business model were regular trading at make-believe valuations. So much hype over a halving is not warranted. Everyone is looking to this one day event and taking their eye off of the long term fundamentals.
Miners Might Just Dump It All
The halving cuts mining rewards in half. This converts to that miners — the individuals essential to the Bitcoin network’s protection — are actually receiving 75% much less in rewards. To stay afloat, they have two choices: become more efficient or sell more of their Bitcoin.
Guess which one's easier? Many will choose to sell. This would create focused and acute selling pressure, more than offsetting any benefits from the lower supply. We may even witness a series of smaller miners going belly up themselves, further destabilizing the network in the process. This is particularly relevant when considering disparate regulatory environments around the world. In truth, some places have been more hospitable to miners than others. This would result in a radical re-location of mining power by geography, with potentially serious consequences for the network’s decentralization.
Consider it something like a farmer dealing with a drought. He can invest in expensive irrigation systems (become more efficient) or sell off his livestock (sell more Bitcoin) to survive. Of these options, which do you think he’s more likely to pursue in the short term?
Regulators Are Watching You, Bitcoin
This is the doozy, and the one that everybody is mysteriously avoiding. And just as crypto gets flushed out, governments around the world are looking to crack down on crypto. A new climate of overregulation, possible prohibitions, and general animus is everywhere. This is no longer a fringe concern—it’s an established, clear and present danger.
Even if the halving does produce a supply squeeze, regulatory headwinds may more than trump redistributive price action. Imagine a major country suddenly banning Bitcoin. Ironically, the resulting panic selling would dwarf any gains from the halving. The presence of large, institutional investors flips the script. Their trading activity is largely driven by traditional financial motivations and regulatory requirements. This profound impact creates a huge amount of uncertainty in terms of how they might react to the halving. Their decisions are much more difficult to anticipate than the retail investors who were smaller, more predictable players in cycles past.
It's like a dam holding back a flood. The halving is just putting a few more bricks in that dam. The regulators are what would open the floodgates. Which of these do you think will be more impactful?
Look, I'm not saying Bitcoin is dead. I'm saying don't be naive. The halving is not a magic bullet. It’s simply one piece of the puzzle in a complicated and unpredictable market.
Do your own research. Understand the risks. For God’s sake, don’t put in money you can’t afford to lose. The promise of easy riches is a siren song, in the halving too. Letting it tempt you on the shore become rocks. Market analyses of ETH, XRP, BNB, SOL, DOGE, ADA, SUI, LINK and AVAX follow next in the queue. Bitcoin's fate dictates the overall mood.
Remember, this isn't investment advice. It's a dose of reality. Consider yourself warned.
Remember, this isn't investment advice. It's a dose of reality. Consider yourself warned.
