In the cryptocurrency world, the upcoming Bitcoin halving, which is set to happen in May 2024, has been a hot topic. Miners’ block rewards are cut in half every four years by a pre-programmed event. This means that fewer bitcoins are issued every day. Read about “JPMorgan Speaks Out: Why JPMorgan Thinks the Bitcoin Halving Won’t Spark a Rally?” below.
It has been observed that these halvings have happened at times when the price of Bitcoin has gone up significantly. According to JPMorgan Chase, the world’s biggest bank by assets, there won’t be an automatic price rise after 2024.
Why JPMorgan Believes the Halving Might Not Spark a Rally
Previous halvings have happened during bull runs, but JPMorgan analysts say that the current market situation is different, so a similar price explosion is not expected. They aren’t as excited about a rise after the halving for the following reasons:
- Macroeconomic Gloom: Global economic problems include rising prices, central banks’ efforts to lower interest rates to fight inflation, and the current war in Ukraine. Investors are likely to be less willing to invest in risky investments like Bitcoin because of these problems.
- Regulatory Uncertainty: Thousands of regulators around the world are closely looking at cryptocurrencies. If this happens, institutional buyers might not want to get into the market, which could stop Bitcoin’s price from going up.
- A More Mature Market: After the previous halving rounds, the cryptocurrency market has changed a lot. Speculation excitement that caused huge price jumps in the past might not be as common this time. Customers are likely to be more careful and do more research before spending.
According to JPMorgan, the halving will definitely reduce the amount of Bitcoin available, which could possibly push the price up in the long run. Due to the above headwinds, their short-term outlook for Bitcoin stays negative.
Beyond JPMorgan’s Analysis: A Look at Bullish Counterpoints
JPMorgan’s point of view isn’t the only one that matters. Consider these counterarguments:
- Limited Supply: Bitcoin’s total number is limited to 21 million coins. If the issuance rate keeps going down with each half, this natural scarcity could become even more noticeable, which could cause the price to rise over time.
- Institutional Interest: Despite problems with regulations, Bitcoin use in institutions is growing. Cryptocurrency is becoming more accepted as an asset class, as shown by the fact that big companies like Tesla and MicroStrategy retain Bitcoin on their books. Increased interest from institutions could give Bitcoin’s price a big boost.
- Technological Advancements: The Bitcoin network is always changing, with developers working to make it more scalable and safer. The price of Bitcoin might go up if these improvements make it easier for more people to use and more appealing to a bigger audience.
Also Read: 3 Best AI Crypto Projects to check in Bull run 2024
Conclusion: A Balancing Act for Investors
According to JPMorgan’s research, the upcoming halving of Bitcoin is better understood by looking at the current market conditions rather than past trends. The decrease might not trigger prices as automatically as it has in the past. Prior to making any investment choices, people interested in cryptocurrencies should carefully consider how the complex interplay of macroeconomic factors. Regulatory changes, and technological advances affect the space. I hope you find “JPMorgan Speaks Out- Why JPMorgan Thinks the Bitcoin Halving Won’t Spark a Rally?” .
Disclaimer: For your information, investing in cryptocurrencies comes with a lot of risks. Such as high fluctuation and the chance of losing all your money. If you’re looking for information, this piece isn’t it. It’s not financial advice. Always do your own study before deciding to invest.
