Pseudonymous crypto analyst PlanB recently offered insights into the current state of Bitcoin, shedding light on a critical period for BTC enthusiasts before the impending halving event scheduled for April 2024.
PlanB emphasized that the six months leading up to the halving, and the subsequent year and a half, constitute pivotal windows of opportunity for both buyers and sellers. This implies that the true impact of these halving events won’t be realized until late 2025.
The analyst underscored the central tenet of the Stock-to-Flow (S2F) model, which posits that scarcity is a driving force behind price movements, with each halving event significantly reducing the issuance of BTC, consequently making the asset even scarcer.
PlanB took to Twitter to remind his followers that the period between “halving minus 6 months” and “halving plus 18 months” has historically outperformed a simple buy-and-hold strategy. He reaffirmed that this phenomenon underscores the S2F model’s core principle: that scarcity, underpinned by halving events, is a fundamental driver of Bitcoin’s price.
Looking back, the most recent BTC halving occurred in May 2020, coinciding with the global financial and economic system’s abrupt halt due to the pandemic. In November 2021, approximately 18 months later, BTC reached a peak of around $69,000. According to PlanB, this pattern isn’t an isolated incident but a recurrent trend.
Notably, other influential figures in the cryptocurrency arena share the belief that halving events wield substantial influence over BTC’s price. Binance’s CEO Changpeng Zhao (CZ), for instance, suggested that Bitcoin typically attains multiple all-time highs (ATHs) in the year following a halving, rather than experiencing an overnight surge, as is often speculated.
At present, Bitcoin is trading at $34,300, predominantly confined within the price range of $32,000 to $34,000. The recent upswing in price was largely driven by speculations and news surrounding the prospects of a spot Exchange-Traded Fund (ETF). The question that looms is whether November will see the price breaking through the $34,000 mark or settling into an extended consolidation phase.