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Analyst Take Unlike Litecoin Bitcoin’s halving will have a sig

Date:2024-05-22 20:28:05 Channel:Build Read:

In the world of cryptocurrency, Bitcoin has always been the center of attention. Its unique halving mechanism has always attracted much attention. Unlike Litecoin, Bitcoin’s halving events often create huge waves in the market. This article will provide an in-depth analysis of the significant impact of the Bitcoin halving on the price and explore the storm this event caused in the cryptocurrency market.

Bitcoin’s halving is an event that has attracted much attention. It is not only an internal mechanism adjustment in the digital currency field, but also the beginning of a market storm. Unlike Litecoin, Bitcoin's halving occurs regularly every four years, which means that the supply of Bitcoin will be halved, thus affecting the supply and demand relationship in the market and causing price fluctuations. This unique mechanism makes Bitcoin's price performance more uncertain and intense, attracting the attention and participation of many investors.

Bitcoin’s halving event often sets off a price storm in the market. Past halving events have proven to have a significant impact on Bitcoin’s price. For example, after two halvings in 2012 and 2016, Bitcoin price experienced significant increases. This shows that the halving event is not just a technical adjustment, but also a concentrated expression of market psychology and investment expectations. Investors often adopt different strategies before and after the halving. Some choose to hold and some choose to sell. As a result, trading activities in the market will become extremely active.

In addition to market price fluctuations, the Bitcoin halving will also have a profound impact on the mining industry. As the halving approaches, the difficulty of mining will increase, and so will the cost. This is both a challenge and an opportunity for miners. Some miners may choose to exit the market, while others will adapt to new challenges through technology upgrades and cost controls. This market self-adjustment mechanism will also affect the stability and future development direction of Bitcoin prices.

Behind the Bitcoin halving, there is more market logic and investment psychology hidden. Investors tend to adjust their investment portfolios based on the halving event and look for more stable and potential asset allocations. Such market changes and fluctuations will also attract more funds and attention, further promoting the development and growth of the Bitcoin market. Therefore, Bitcoin’s halving is not only a technical adjustment, but also a reshuffle and reshaping of the market.

In general, Bitcoin's halving event has a significant impact on its price. This event is not only a technical adjustment in the digital currency market, but also a reflection of market psychology and investment expectations. Investors need to pay close attention to the development of the Bitcoin halving event, adjust their investment strategies in a timely manner, and grasp market changes and opportunities. Bitcoin’s halving will continue to trigger price storms and bring more challenges and opportunities to market participants. May every investor seize the opportunity and achieve wealth growth in this storm.

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Cryptocurrency Analyst@
100trillionUSD pointed out that the premise that Bitcoin’s halving will not have a significant impact on its price because Litecoin does not jump out on its own is fundamentally wrong. The analyst said that unlike Bitcoin, Litecoin’s price does not have a significant relationship with the stock-to-flow ratio, making its halving less relevant to its price.

Litecoin halving will have minimal impact on its price

As Bitcoin dwindles, many cryptocurrency analysts and experts are weighing in on how the quadrennial event will impact the price of the world's largest cryptocurrency. While most Bitcoin maximalists believe that reduced supply after the halving will only increase demand due to the scarcity of the coin, there is a strong strand of skeptics who believe that the halving will adversely affect its growth.

The Litecoin example is used to illustrate this point. Since the coin underwent its second halving on August 5 and its price remained unchanged, many people say that Bitcoin’s own halving also had little impact on its price.

However, prominent Twitter cryptocurrency analyst PlanB claimed that this logic is flawed and provided an interesting comparison between Bitcoin and Litecoin to suggest that BTC’s halving would produce significantly different results.

Analysts pointed out that unlike Bitcoin, Litecoin’s price does not have a significant relationship with its stock-to-flow ratio. Inventory flow is the total amount of merchandise held in inventory divided by the amount produced each year.

Stock Current Ratio Shows Litecoin’s Gloomy Future

When it comes to cryptocurrencies, stock flow is calculated when the total number of coins in circulation is divided by the number of coins created in a month and then divided by 12. This value is used to calculate how many years it will take. All coins currently in circulation were produced, with higher numbers indicating greater scarcity.

According to a series of tweets from PlanB, Bitcoin has a strong stock-to-flow ratio. In addition to this, Bitcoin also has a strong relationship with predicted stock-to-flow values. The analyst said the stock-to-flow model remains "on track" for 2012 and will remain so for several years.

Litecoin, on the other hand, does not appear to have any relationship with the stock-to-flow ratio, analysts noted.

While he said he was unsure why this was the case with Litecoin, several theories emerged during the Twitter discussion. PlanB stated that the lack of network effects, such as on/off ramps, futures, options and liquidity, may cause Litecoin value to remain stable even after the halving.

Others have said that reduced block rewards coupled with lower prices led to Litecoin’s
The miners left en masse. The lack of profitability means less usage of the network, and the only supporters left are those who don’t cause massive price fluctuations.

Regardless, many members of the crypto community appear to have lost faith in Litecoin. While the halving may not affect its price, Litecoin will have a hard time protecting itself from the lack of support from the industry.

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