How To Capitalize On Bitcoin’s Halving Volatility

The next Bitcoin halving event is expected to occur by April 2024. The reduction in the block reward is a crucial reason for the volatility. Foremost, it halves the speed of putting new BTC coins into circulation and creates a huge disproportion of supply and demand. The Bitcoin price chart clearly indicates that previous events caused significant growth and the reaching of new ATHs. In this article, we’ll determine how this situation can develop and how to get more benefits from it.

Other Factors That Cause Volatility

The upcoming Bitcoin halving will be the fourth in its history. Although the exact outcome of this event cannot be predicted, we can discuss potential fundamental factors that will affect BTC price and volatility.

• Supply reduction. The block price will be decreased by 50%. It is expected to be 3.125 BTC/per block in 2024.
• Mining profitability. If the value of the BTC block decreases, crypto miners will do the same amount of work as before but for less reward. That’s why some of them will find it unprofitable to continue this work and go out the business. Meanwhile, the others will keep their Bitcoins, causing a deficit.
• Market sentiment. The BTC price movements depend on the collective mood and the sentiment of retail/institutional investors. For example, additional factors such as public endorsements or BTC media coverage should also be considered.
• Institutional participation. This is another factor to bear in mind. Institutional strategies and reactions are expected to flourish during the fourth Bitcoin halving, significantly impacting price dynamics.
• Regulatory environment. The regulatory landscape in the crypto world has been expanding recently. Any regulatory changes during the halving event may impact the BTC price.
• External events. Cryptocurrency is sensitive to events that occur around the world. Therefore, BTC prices will be affected by pandemics, wars, technological breakthroughs, etc.
• Economic factors. The BTC price is sensitive to inflation rates and global financial health. Any changes in the market will affect the value of the digital coin.

These factors have different weights in influencing the digital coin’s price during the halving period. Take each of them into account when the event occurs.

Bitcoin Volatility: How to Benefit From It And Keep Your Gains Safe

Bitcoin halving volatility happens only once in several years, and you must know how to raise the maximum capital on it. Another point is to preserve your profits. Analyzing the Bitcoin price chart alone may not be enough in this case. You will also need strategic planning, understanding the historical context, and managing the associated risks. Here’s a list of ways for you to prepare for volatility.

• Analytical research. Study all the coin’s properties and pay special attention to the Bitcoin halving consequences.
• Historical analysis. Halving events happen regularly with this cryptocurrency, so studying BTC price action during previous events will not be superfluous. This will give you an understanding of probable entrances and short or long positions.
• Set preliminary investment goals. You should define your investment horizon in advance and follow it despite emotions.
• Stop-loss and take-profit orders are what you need. Set stop-loss and take-profit orders while expecting the upcoming volatility. This approach will protect your investment from significant downturns. Plus, it also allows you to lock in profits.
• Risk management. The higher volatility the lower risk your strategies must include.
• Stay close to other enthusiasts. The crypto world is a large community. Enthusiasts often talk to each other, sharing news, rumors and analysis.
• Follow the latest updates. The crypto world is developing rapidly, and all enthusiasts should be aware of the latest events in the industry.

The Bitcoin halving is almost here, so you should explore the crypto world and BTC coin. Do everything possible to be prepared for the event. Study all the necessary information and find out what changes were accompanied by Bitcoin during the three previous halving events.

Final Thoughts

Halving is an event that comes to the Bitcoin world from time to time. It has happened thrice, and the next event is expected in April 2024. The halving causes the price per block value to halve. Heightened volatility is another consequence that traders and investors should consider.

Bitcoin’s halving events provide strategic opportunities for informed traders and investors. If you are taking your first steps in the crypto world, there are some practical tips to capitalize on the upcoming event.

Pay special attention to studying BTC properties and analyze the coin’s behavior during the three halving events. This way, you will minimize the risks and get good financial benefits. Finally, keep in touch with other investors and traders to react to the next bear market in time.