Caroline Bowler on crypto market movements following geopolitical unrest:
"Investor sentiment shifted to risk-off last week. We saw this in the movement of the US dollar index, which closed Wednesday up by 1.04%.
Gold, a traditional haven, reached all-time highs on Friday as investors sought refuge from market uncertainty.
In contrast, Bitcoin experienced selling pressure over the weekend, following the escalating actions in the Middle East. This divergence underscores the nuanced reactions observed within the cryptocurrency market during times of geopolitical unrest.
The sell-off in the cryptocurrency market is largely attributed to significant long liquidations triggered by the unfolding news event. Despite this, Bitcoin's price found support at the US$60.6K mark, with anticipation mounting for the opening of US markets."
Caroline Bowler on the upcoming bitcoin halving:
"The bitcoin halving, occurring roughly every four years, marks a pivotal moment in the cryptocurrency's protocol.
During this event, miners' rewards for validating transactions are slashed in half, curbing the creation of new Bitcoins. The halving process is hardcoded in the Bitcoin blockchain.
This mechanism is integral to Bitcoin's monetary policy, maintaining its scarcity and preventing the total supply from surpassing 21 million coins.
This scarcity sets Bitcoin apart from fiat currencies, offering a unique value proposition immune to central authority manipulation."
Caroline Bowler on when the halving is expected to happen:
"The fourth halving is anticipated for 20 April 2024 Australian Eastern Standard Time or at block height 840,000. Block height signifies the number of blocks preceding a specific block in the blockchain, ensuring the network's integrity by maintaining a chronological record of transactions.
As new blocks are mined, block height increases incrementally, validating transaction authenticity and reinforcing trust in the blockchain network."
Caroline Bowler on how markets are currently reacting:
"Following the approval of the U.S. spot Bitcoin ETFs on January 10th, the crypto market experienced a surge in investor interest, leading to inflows totalling US$12 billion.
BTC Markets has seen a 61% increase in active traders in March 2024 compared to March 2023, as well as a 130% increase in trading volume when comparing the same time period.
This influx propelled Bitcoin's value by almost 60%, surpassing its previous all-time high and peaking at US$73,794 on March 14th.
However, since then, Bitcoin's price has stabilised, reflecting a period of market consolidation.
This could be attributed to factors such as profit-taking by short-term traders, adjustments by institutional investors, and market participants awaiting new catalysts."
Caroline Bowler on how markets have reacted historically:
"Historically, Bitcoin halving events have led to significant price surges and heightened investor demand.
During the 1st halving in November 2012, Bitcoin's price soared from US$12 to a peak of US$1,163 over 367 days, showcasing a remarkable price appreciation of 9,583.60%.
Similarly, the 2nd halving in June 2016 witnessed Bitcoin's price surge from US$663 to a record high of US$19,666 over 562 days, representing a price appreciation of 3,041.53%.
In the most recent halving in May 2020, Bitcoin's price surged from US$8,741 to a cycle high of US$73,794 over 1,403 days, marking an increase of 802.02%."
Caroline Bowler on how miners and the wider industry will be impacted by the halving:
"The halving poses significant challenges for Bitcoin miners, as the block reward is slashed, leading to reduced revenue.
This could render mining operations less profitable, particularly for those with higher costs or outdated equipment.
Potentially forcing some miners to cease operations temporarily, thus impacting the network's hash rate.
The halving is anticipated to foster a more sustainable and resilient Bitcoin ecosystem by encouraging efficient mining practices and ensuring the network's long-term viability.
The event often sparks innovation in mining technologies and strategies as miners adapt to Bitcoin's evolving economic landscape."