By Bitcoin’s recent price surge past $52,000 has sparked speculation about a pre-halving rally, a historical trend associated with the upcoming reduction in mining rewards.
Analyst Jag Kooner, Head of Derivatives at Bitfinex, believes the current market movement aligns with such a rally, typically starting eight weeks before the halving event.
“This rally has the potential to push prices beyond previous cycle highs,” Kooner said in a statement shared with Cryptonews, citing the recent return of Bitcoin’s trillion-dollar market cap and consistent inflows into spot Bitcoin ETFs as contributing factors.
At the time of writing, Bitcoin is trading at $52,290, over 13% up in the last 7 days, as per Coingecko data.
Consistent Inflows Into Bitcoin ETFs Pushing the Current Rally
He attributes diminishing selling pressure from Grayscale’s GBTC conversion to further supporting the price. The analyst noted:
“The diminishing selling pressure from GBTC and consistent inflows into other ETFs, averaging $300-400 million daily according to recent data, have been significant contributors.”
However, Kooner cautions against solely relying on historical patterns. “While they offer insights, they don’t guarantee repetition,” he emphasizes. He points to the rising interest in altcoins as a unique aspect of this potential pre-halving phase.
Commenting on the entire crypto market reaching $2 trillion in value, the analyst said:
“There has been a gradual flow of capital towards the altcoin market. Due to the large number of crypto projects this cycle, however, there has been a flow of capital into specific sectors like the Solana ecosystem and AI based projects rather than a gradual spreading of capital into all altcoin markets.”
The next Bitcoin halving is expected in April, reducing the miner reward per block by 50%. This event, occurring roughly every four years, aims to control the supply of new Bitcoins, potentially impacting its value due to increased scarcity.
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