Donald Trump’s victory in the U.S. election is unlikely to be the “main story” behind Bitcoin’s recent rally – analysts point out, but rather a post-halving supply shock.
“If you’re wondering what’s going on with #Bitcoin…yes, the incoming Bitcoin-friendly government has provided the recent catalyst…but, that’s not the main story here,” explain Onramp Bitcoin co-founder Jesse Myers published an article on X on November 11.
“The main story here is that it’s been over 6 months since the halving.”
Bitcoin (Bitcoin) Halving in April Cutting the block reward from 6.25 BTC to 3.125 BTC means that the next block becomes harder to solve and the reward is smaller.
Myers added that this means supply shock has accumulated. “At current prices, there is not enough supply to meet demand,” and the price balance between supply and demand must be restored.
The launch of a Bitcoin exchange-traded fund (ETF) in January this year has fueled this demand. On November 11, the U.S. Bitcoin ETF had another big day of capital inflows, with approximately 13,940 Bitcoins purchased in one day, while the mining volume was only 450 Bitcoins.
“The only way to do that is for prices to go higher, which will lead to mania and bubbles, but that’s how things work.”
He added that it sounds crazy to say that a reliable and predictable bubble occurs every four years, but there has never been an asset in the world where new supply has been cut in half every four years.
“The result is a post-halving bubble,” he said, stressing that this happened before and after halved 2012, 2016, 2020, and now it’s happening again, the price will be higher.
source: Jesse Myers
On-chain analyst James Check echo Compare Bitcoin’s market capitalization to gold, which has increased by about $6 trillion over the past year but has “hundreds of billions of new and recycled supply entering the market.”
He predicted that Bitcoin, with a market cap of just $1.6 trillion, would go higher due to “absolute scarcity for holders who have been through hell many times.”
Related: Bitcoin hits a new high of $85,000, only 17% away from BTC’s record of $100,000
On November 12, American financier Anthony Scaramucci hint At the same time, he had this to say to those who haven’t been paying attention to Bitcoin over the long term: “You might feel like you’re missing out on it, but you’re not. It’s still early.”
He believes the United States will build a strategic reserve of Bitcoin and other countries, as well as institutional asset allocators and managers, will follow suit.
As of now, 94% of existing Bitcoins have been circulated or lost, meaning there are only about 1.2 million Bitcoins left to be mined, putting further pressure on supply and demand.
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