Key Points
- Current short-term Bitcoin investors are mirroring the behaviour seen in 2019, potentially indicating a rally.
- Analysts are divided over the likelihood of a post-halving rally in 2024 and the potential price triggers.
Bitcoin Investors Replicating 2019 Behaviour
Five months after the halving event, Bitcoin’s historical parabolic rally has yet to materialize. However, CryptoQuant suggests that it may still be possible, given that current short-term Bitcoin investors are reflecting the same behaviour seen around the 2019 halving event. The data shows that Bitcoin rallied 490 days after new investors peaked around the 2019 halving event, and a similar pattern seems to be unfolding now.
UTXO (unspent transaction output) provides insights into Bitcoin holders and their behaviour based on age bands. Notably, the data tracked those who held Bitcoin for less than six months (new users). However, the UTXO declined after Bitcoin peaked in March, which the data attributed to new investors likely exiting due to losses.
Mixed Opinions on Post-Halving Bitcoin Rally
Despite the historical pattern, opinions are divided on the likelihood of a post-halving Bitcoin rally. Some, like renowned analyst Peter Brandt, believe that Bitcoin might not hit a new all-time high after stagnating for too long compared to previous cycles. Meanwhile, Outlier Ventures’ Jasper De Maere suggests that Bitcoin and digital assets have matured and that the halving event will have little impact on price in 2024.
However, others like James Straten believe that the recent 34% drawdown to $49k is a normal part of the bull run and that a post-halving rally is still likely. Despite this, Bitcoin network activity has contracted further as active addresses hit a record low in 2024, potentially dragging the price down due to decreased interest in the digital asset.
Whether an expected positive macro front amid a likely Fed rate cut will trigger the post-halving rally remains uncertain. As of now, Bitcoin is valued at $56.7k and has been below $60k since the beginning of September.
