Is Now a Good Time to Buy Bitcoin? What History Tells Investors

New spot-Ether ETFs launched in the US, while the Grayscale Ethereum Trust converted to an ETF, leading to significant outflows and cautious sentiment. Market observers noted that the crypto market felt the impact of negative sentiment from US equities. However, the pressure on Ether following the ETF launches might ease if market conditions improve.

However, cryptocurrency remains a hot topic in the 2024 US presidential election, with markets keenly anticipating former President Trump's speech at the Bitcoin 2024 conference in late July. As US political parties adopt more favorable stances toward Bitcoin, discussions about its potential as a "global reserve asset" are gaining traction.

Industry insiders, including Satoshi Action Fund co-founder Dennis Porter and BnkToTheFuture founder Simon Dixon, suggest Trump may announce Bitcoin as a strategic reserve asset for the US at the conference. Over the past month, Bitcoin has surged approximately 11%, outpacing global stock markets, which have seen gains of less than 2%. Historical data indicates that Bitcoin may still be at the early stages of this bull market cycle.

The April 19 Bitcoin halving event was largely overlooked due to the cryptocurrency market's focus on the SEC's approval of spot Bitcoin ETFs. However, the significance of the 2024 halving should not be underestimated, as its impact will be felt throughout the year and beyond.

Bitcoin's halving event, a crucial occurrence every four years, reduces mining rewards by half to control inflation and maintain scarcity. This mechanism, rooted in Bitcoin's code, is designed to support its value by decreasing the rate of new Bitcoin issuance, potentially boosting prices if demand stays constant. Historically, halvings have led to significant price surges. The first halving in 2012 cut rewards from 50 BTC to 25 BTC, with subsequent halvings in 2016 and 2020 following suit. Currently, miners earn 3.125 BTC per block, worth over £167,000, but this will halve again after 210,000 blocks. The last halving will occur in 2140, capping Bitcoin's supply at 21 million and shifting miner compensation to transaction fees. While past halvings have driven price increases, experts debate whether these rises are directly due to the halving. Nonetheless, Bitcoin's price volatility and potential for higher valuations continue to captivate the market.