I'm gearing up for my fourth Bitcoin halving, and I've got a feeling history's going to repeat itself, albeit with a few twists. Everyone seems to be asking, "How high will Bitcoin's price soar?" But there's a more crucial question on the table: "Are you ready for a potential bear market?" If we take a page out of Bitcoin's history's book, we might witness a hefty sell-off as we edge closer to a newer all-time high, similar to what happened after previous halvings.
This upcoming halving is looking very unique.. For those new to the term, a "halving" is when Bitcoin mining rewards are cut in half every four years, or after 210,000 blocks have been mined. It started with 50 BTC rewarded to miners every 10 minutes, then halved to 25, then 12.5, and we're now at 6.25. With the next halving in April, mining rewards will drop to 3.125 BTC. Besides the block rewards, miners also rake in Bitcoin from transaction fees.
What makes this halving stand out? A few things: Bitcoin's market cap has ballooned to over $1.4 trillion, overtaking silver. The SEC's nod for Bitcoin ETFs has made buying and selling a lot more active. Since the last halving, there's been a huge spike in new wallets and much more awareness among folks about Bitcoin. The blockchain's bustling with more transactions than ever, boosting transaction fees that might soon eclipse mining rewards. With over 95% of Bitcoin already mined, future miner earnings will largely come from these transaction fees. In a nutshell the rewards are not going to significantly change as the last few halvings have.
Being prepared for both the highs and lows is key. Whether we're heading into a bull run or bracing for a bear market, smart planning can help you achieve your Bitcoin goals. Remember, only invest what you can afford to lose, and always have a plan for exiting the market.
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