Bitwise CIO asserts the significance of Bitcoin halving
Bitwise’s Chief Investment Officer, Matt Hougan, has provided a long-term perspective on the Bitcoin halving, based on historical data and the demand for spot ETFs. During an interview with CNBC on April 19, Hougan referred to this year’s Bitcoin halving as an opportunity for investors to “buy the news” in relation to the world’s largest cryptocurrency asset class.
The halving is a pre-programmed code change incorporated by the anonymous Bitcoin creator, Satoshi Nakamoto, to control the inflation of BTC and maintain scarcity in its supply. Nakamoto designed the system so that mining rewards are reduced by 50% every four years or after every 210,000 blocks.
As a result of the halving, the amount of new BTC entering circulation is also halved. Many believe that this decrease in supply, along with the growing demand for spot Bitcoin ETFs, will lead to higher prices next year. Hougan, whose company is an issuer of BTC ETFs, supports this sentiment.
According to Jeff Hancock, the CEO of Coinpass, Bitcoin has evolved from being a hobby and a speculative market to becoming a real asset with institutional interest. He believes that this cycle will be different, especially in an economy with high inflation and high interest rates.
Hancock predicts that the global demand for Bitcoin will continue beyond 2024, and traditional finance (tradfi) will continue to embrace the crypto ecosystem. In less than six months, spot Bitcoin ETFs have already accumulated over $60 billion in assets. Hancock also believes that the success of spot BTC ETFs could extend to an Ethereum counterpart, despite facing opposition from the U.S. Securities and Exchange Commission (SEC).
Overall, the Bitcoin halving is seen as a significant event that presents an opportunity for investors to enter the market. The demand for spot BTC ETFs is expected to contribute to the increase in Bitcoin’s price, and the interest in cryptocurrencies is predicted to continue to grow in the coming years.
