What Could Go Wrong with Bitcoin Halving?

The Bitcoin having is almost here we Asked Market analysts and Representatives of mining companies to Give us their perspective on the impact Of this Milestone event so no time to Waste let's Jump Right In let's start With miners miners are those most Affected by the Bitcoin having their Revenue called mining rewards will be Slashed in half from 6.25 BTC to 3.125 BTC currently you have a daily minor Revenue in the entire world of around $64 million and that will hard to $32 Million such a huge decline in the Industry Revenue will of course be a big Shock to the entire industry hence many Miners will be pushed out of business And shut down their operations with only The most efficient being able to survive Everyone is worried for the having even The most efficient operations just Because the block subsidy reducing is Out of everyone's control why should you Care you may ask well because miners Guarantee bitcoin's fundamental Properties namely security and Censorship resistance by producing a Large amount of computational power or Hash power Bitcoin miners make it Incredibly difficult for anyone to Manipulate the Bitcoin blockchain by the Way if you want to know more about how The having actually works check out our Video for beginners in the description

Now some say that with block rewards Decreasing every four years with a Having miners will have less and less Incentive to secure the blockchain some Say that could pose a long-term risk to Bitcoin which could become increasingly Vulnerable to the so-called 5 1% attack Which is when a single entity gains the Majority of the Bitcoin hash rate and Therefore can attack the network but Let's not panic since the having is an Entirely predictable event that happens About every four years miners have had Time to prepare some have been upgrading Their mining rigs making them more Efficient in order to fund these Upgrades many miners have been selling Large amounts of their BTC reserves Taking advantage of the latest Bitcoin Rally other miners have moved older less Efficient equipment to areas with Cheaper electricity if you continuously Have to upgrade your machine to have the Last machine in order to be profitable It means that you're actually paying too Much for your electricity therefore the Only real long-term viable way of Building a mining operation is having Access to extremely cheap electricity You have to go uh into for example uh Africa to find that so hash laabs mining We are expecting to accommodate a lot of These machines in Africa to give them a Prolonged

We'll see a lot of miners um start to Diversify energy-wise a lot of miners Are going to migrate towards stranded Energy they go to landfills and they'll Use that the trash for mining Bitcoin Other mining firms are using the having As an opportunity to win market share Over less efficient competitors for Example Marathon digital has announced Its plans to use its $1 billion strong Balance sheet to double its hash rate Bringing it to 50 EXA hash by the end of 2025 lastly let's not forget that Besides the block rewards miners have a Second source of Revenue transaction Fees but at the moment transaction fees Only constitute a small percentage of The Minor's revenue for example in March This year only 4% of Revenue came from Transaction fees but this situation is Likely to change in the future we're Going to see more and more activity on The Bitcoin blockchain this increase Demand for Block space will lead to a Very big search and transaction fees I Think there will be a point I don't know If it'll be this having or the next or The next that transaction fees do pass The um the block subsidy in 2025 uh I can foresee a situation where The uh transaction fees periodically are Higher than the block subsidy one of the Reason why transaction fees are likely To increase in the future is the

Emergence of ordinals or nfts on the Bitcoin blockchain this new Bitcoin use Case has gained Traction in the last Year and a half significantly boosting Transaction fees on the Bitcoin Blockchain thus far ordinals have Generated approximately $240 million in Transaction fees and this trend is Growing so even though the the Hing will Decrease mining Profitability I still think and the hash Rate will continue to increase I don't Think we will see a very large drop in Hash rate after the Hing maybe around 10% or less finally the widespread Expectation is that bitcoin's price Price will increase significantly in the Months following the Bitcoin having Which should compensate for the Diminished rewards in terms of block Subsidies if you're selling 100% of your Bitcoin to cover your expenses and your Capital expenditures and the Bitcoin Price doubles well now you only need to Sell 50% of your Bitcoin to get the same Amount of dollars the impact of the Having on pricings is what we're going To discuss next will the having impact Bitcoin's price let's distinguish Between the short and long-term impacts On price surrounding the Bitcoin Havoc From a price perspective the having May Initially appear as a non-event Primarily because its occurrence is

Fully anticipated and thus already Factored into market prices however Given high levels of speculation and Anticipation surrounding this event Heightened volatility is to be expected Particularly around the having date we May even witness a posst having pullback Due to the classic buy the rumors sell The news phenomenon however it's in the Medium to long term that we can expect The most significant impact on prices The having effectively slashes the Supply of new Bitcoin in half according To the fundamental law of supply and Demand a decrease in the supply of new Bitcoin coupled with stable or Increasing demand should theoretically Lead to a surge in Bitcoin value over Time at least that's what happened on The occasions of the previous Bitcoin Having as you can see in the chart Bitcoin has surged in the 12 months Before and after each Havoc the biggest Appreciation has happened in the months Following the event you can also notice The impact of the having on bitcoin's Price has been decreasing over time this Is because the reduction in new Supply Decreases with every having and this is Why most analysts believe bitcoin's Price increase will be significantly Less than in previous Havingsex it used to be 10x as you get More and more people involved in this

Asset arbitraging um buying selling Involved it will continue to squash that Volatility still many analysts believe Bitcoin's price could double in value Before the end of the year again we need To stress that these are just Predictions there's no guarantee that Bitcoin's price surge after the having At the end of the day there were just Three previous Bitcoin To potentially huge bitcoin price surges It had already happened it was the first Time in history that Bitcoin broke Through its previous all-time highs Before the Bitcoin having the further Rise of bitcoin's price following the Having will significantly depend on Whether the inflows to these ETFs will Continue total inflows in Bitcoin ETFs This year is about 122 billion unless Something happens to radically shift That demand negative price must go up Over time if that is the case observers Even say that the ETF Factor could Invalidate the trend of diminishing Returns after each havoc in other words That we should expect an even bigger Price increase than in the previous Cycles Analyst at Standard Chartered Highlighted the rise of gold prices Following the approval of the first gold ETF and came to the conclusion that Bitcoin could reach 250k by the end of 2025 the big picture

Of the economy is another factor that Will determine bitcoin's price after the Havoc in the past po having rallies Happened when there was a lot of money Floating around the global economy which Was good for risky Investments like Bitcoin for example the last having Occurred during the covid pandemic when Governments were pumping lots of money Into the economy to help it recover but Now things aren't the same there's not As much money floating around globally And the Federal Reserve still has Interest rates quite High the key thing I'm concerned about is a backup in beta And the impact it'll have on bitcoin if You look at 10year old yields in the US They're 4.3 or so and most of the rest Of the world in Europe they're three and Two handles and China it's a two handle That's indication that Bon you'll see Global recession coming and we just have To see if Bitcoin can trade more like Gold when beta goes down than more like Beta And I suspect with a high Volatility it's still at risk of a Decent draw down regardless of what the Impact on prices might be the having Remains one of the properties at the Core of bitcoin's fundamental value it's The foundation of bitcoin's unalterable Monetary policy unlike traditional Fiat Currencies Bitcoin operates on a fixed Supply schedule with a maximum cap of 21

Million Bitcoins coins this property Positions Bitcoin as a potential hedge Against currency devaluation and Inflationary pressures in Fiat Currencies what you have is essentially A regulated Monopoly uh that is that There are certain people who are legally Authorized to counterfeit the money uh To print more of it and this is really What differentiates Bitcoin from any Other kind of asset in the world which Is that um no no other asset has a Having the having is a crucial Milestone That's if is one of bitcoin's Fundamental properties being a scarce Asset similar to Gold if past cycle Patterns repeat themselves the having Will likely be followed by a spectacular Surge in price in the months to come Despite the initial shock miners will Likely adapt to reduce revenues by Improving hardware and relocating to Areas with cheaper electricity however History doesn't always repeat itself Factors such as Bitcoin ETFs the rise of Ordinals or different macroeconomic Conditions could lead to different Outcomes this time therefore let's be Prepared for all the different possible Scenarios if you enjoyed our content Consider giving a like and subscribing To the channel I'm Max and we'll see you Next time


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