Comparing the progress of previous Bitcoin halving cycles to the current cycle will provide insight into whether it is stretched. The extended halving cycle means the price high is now being delayed.
Money management, consulting and analytics firm Quantum Economics recently announced research bullish predictions like bitcoin hitting $100,000 in the last few months before the end of 2021 as well as when it might come true.
No market top so far
In about 4 years, with 210,000 blocks mined, the block reward given to bitcoin miners for processing transactions will be halved and continue to decrease until the block reward becomes 0 (around year 2140).
The last Bitcoin Halving event took place on November 5th, 2020 and the block reward has only been 6.25 BTC since then.
While the previous halving was correlated with violent boom and bust cycles ending in higher prices prior to the event, the current cycle has been tested from the time of the price action as there has been no market top to date.
The percentage change in bitcoin price since the halving event shows that the current halving cycle is lagging behind the previous two, despite a relatively strong start.
Percentage of bitcoin price change since 3 halving events | The source: quantum economy
The last one performed better than the second halving cycle percentage up to day 391, but price action has been rather disappointing since then.
“This cycle is different from all others, or we still haven’t seen a clear cycle end like in previous cycles,” said Jan Wüstenfeld, on-chain analyst at Quantum Economics. This, he explains, is a sign that “this cycle is probably not over yet.”
Extend the cycle halving
At the same time, the analyst continued to examine relevant statistics from all three halving cycles, including some data from before the first halving, which he calls the “Genesis Cycle.”
Formation Cycle and Halving Cycle | The source: quantum economy
According to the data sheet, Bitcoin took 367 days in the first cycle until the price reached a new all-time high (ATH). In the second cycle, this period is extended to 527 days.
Therefore, it took significantly longer (44%) in the second cycle to climb to a new record.
“Because we know how many days it has taken for Bitcoin to make a new high in previous cycles, it is possible to predict when the leading digital currency will make a new high in the current cycle, given one of the previous cycles repeating itself” , according to the analyst.
Hypothetical Dates Bitcoin Price May Reach ATH | The source: quantum economy
If the first cycle repeats, bitcoin price will hit a new ATH in May 2021, while the second cycle repeats last October.
Wüstenfeld created a linear trend based on the fact that the second cycle took 160 days longer than the first cycle for the bitcoin price to reach its peak in the cycle.
According to his prediction, the current halving cycle will take 757 days to reach ATH – likely in June 2022, around 5 months from now.
Because Wüstenfeld’s projection is based on a linear trend with only two data points, significant errors are introduced.
“More important than exact timing is that the cycle is likely to continue and we don’t necessarily need to hit this cycle’s tops,” the analyst concluded, noting that bitcoin price is dependent on a number of factors not mentioned here its analysis, the most important of which is the evolution at the macro level”.
However, consider the signs that the halving cycle is lengthening and the fact that there has not been a clear price top so far in the current cycle. So there is a high possibility that ATH will be delayed.
One thing is for sure, with 120,589 blocks remaining and around 778 days until the next halving, there is still plenty of time for the unexpected.
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