Market momentum is insufficient, the "halving" event failed to support the price of Bitcoin

Zhitong
2024.05.09 22:32
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Bitcoin prices fell, with other cryptocurrencies performing poorly as well. Despite the earlier surge in prices this year, the market momentum remains weak. Bitcoin fell by 0.7% in the past 24 hours to $62,106. The halving event for Bitcoin failed to support prices, with the market expecting prices to reach $45,000. In addition to Bitcoin, Ethereum also saw a slight drop to $3,008.75. The U.S. Securities and Exchange Commission is expected to make a final decision on Ethereum spot ETFs this month, but the market remains cautious about its swift approval

According to the Smart Finance app, on Thursday, the price of Bitcoin fell, and other cryptocurrencies performed poorly. Despite the earlier surge in prices this year, the market momentum still appears to be lacking.

In the past 24 hours, Bitcoin has dropped by 0.7% to $62,106. As the largest cryptocurrency by market capitalization, Bitcoin reached a near-historic high of around $74,000 in mid-March due to the high attention on the newly launched Bitcoin exchange-traded funds (ETFs), but the price has since retreated.

Superficially, this price drop is puzzling because theoretically, the halving event on April 19 should have supported the price of Bitcoin. During this halving, Bitcoin's programmed monetary policy changed, with the issuance of new coins halved, thus limiting the supply.

JPMorgan strategist Nikolaos Panigirtzoglou believes that the impact of the halving event may have already been priced in by the market. The bank's analysts suggest that the price of Bitcoin is significantly higher than their volatility-adjusted comparison with gold, indicating a price target of $45,000 for Bitcoin. A more bullish explanation is that past Bitcoin halving events have led to delayed price increase cycles.

Matteo Greco, a research analyst at Fineqia International, wrote in a recent research report, "The recent halving event has resulted in a short-term price decline, which is a pattern that has occurred before. Typically, there is a 9 to 12-month upward trend following this, eventually reaching the peak of the market cycle."

In addition to Bitcoin, Ethereum briefly dipped to $3,008.75. The U.S. Securities and Exchange Commission (SEC) is expected to make a final decision on Ethereum spot ETFs this month. However, following the approval of Bitcoin ETFs and the subsequent historic high in Bitcoin prices, the market is cautious about the rapid approval of Ethereum ETFs.

Greco added, "Market participants anticipate that despite the SEC approving BTC ETFs in January, the SEC may delay approval of these products. Concerns about liquidity in the ETH spot and futures markets, as well as the SEC's past classification of them as securities, have raised doubts about swift approval."

Small cryptocurrencies or altcoins had mixed performance on Thursday, with Cardano down 0.8%, Polygon down 0.5%, and Dogecoin slightly down

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