Punching in the Air?
It’s not difficult to understand why BTC is surging (see more below) but understanding BTC itself (or any of the shitecoins for that matter) is extremely difficult.
They say don’t invest in anything you don’t understand. ‘They’ being people who didn’t buy BTC a year ago.
Also, I remember many a savvy investor said once or thrice — if everybody is punching in air — SELL.
If you want to understand BTC, then this is a good place to start. A great little video.
BTC is hiking up for 2 main reasons:
Firstly, because of the ever-growing confidence about an early January approval of a Bitcoin ETF. There is the risk of a big fall of course, if those expectations are not met.
Secondly, there is a BTC halving coming up around April next year*. A lot of people get excited about a halving which happens every four years as past experience shows the price goes up.
*This is ChatGPT’s boring take on BTC halving
Bitcoin halving, often referred to as the "halvening," is an event that occurs approximately every four years in the Bitcoin network. It is a programmed reduction in the reward that miners receive for validating and adding new transactions to the Bitcoin blockchain. The purpose of the halving is to control the supply of new bitcoins entering circulation and to maintain a capped total supply of 21 million bitcoins.
Here's how the Bitcoin halving works:
Mining Reward: Bitcoin miners are rewarded with newly created bitcoins for their efforts in solving complex mathematical problems, which secure the network and validate transactions. This reward is known as the "block reward."
Halving Schedule: The Bitcoin protocol dictates that the reward for mining a new block is halved approximately every 210,000 blocks. This occurs roughly every four years. As a result, the rate at which new bitcoins are created is reduced.
Impact on Supply: The halving has a significant impact on the rate of bitcoin creation. After each halving, the number of new bitcoins entering circulation is reduced by half. This reduction continues until the maximum supply of 21 million bitcoins is reached, expected to occur around the year 2140.
Market Dynamics: The Bitcoin halving is closely watched by the cryptocurrency community and can have an impact on the market. Some investors and analysts believe that the reduction in the rate of new bitcoin creation creates scarcity, which may contribute to upward price movements. However, the relationship between halving events and price is complex, and various factors influence the market.
The previous Bitcoin halving events occurred in 2012, 2016, and 2020. The next halving is expected to occur around 2024. It's important to note that while the halving is a scheduled and predictable event, its specific impact on the market is influenced by a wide range of factors, including market sentiment, demand and supply dynamics, macroeconomic conditions, and regulatory developments.
I love putting out Lighthouse33 so thanks for reading! We are all on some kind of remarkable quest and my wholehearted goal is to provide a little illumination on your journey.
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