Key Points
- The recent Bitcoin halving hasn’t led to the anticipated increase in value.
- Analysts suggest the price correction is due to macroeconomic uncertainty, not the halving.
The Bitcoin halving event that took place last Saturday has not resulted in the predicted surge in price. The largest digital asset by market capitalization has seen a drop of over 7% in the last week.
Analysts propose that the recent dip in price is a result of broader economic instability rather than a sell-off following the halving. The effects of the Bitcoin halving had been factored into the market for several weeks prior to the event.
Macroeconomic Influence
One analyst suggests that the correction is driven by macroeconomic factors, including disappointing tech earnings and higher U.S. rates. This view is supported by Aurelie Barthere, Principle Research Analyst at Nansen.ai.
U.S. Inflation Continues to Rise
The U.S. Bureau of Economic Analysis reported a rise in inflation to 2.7% on an annual basis in March from 2.5% in February. This exceeded market expectations of 2.6%. The core U.S. Personal Consumption Expenditures (PCE) Price Index, excluding volatile food and energy prices, remained at 2.8% on an annual basis, surpassing the estimated 2.6%.
Historically, the 250-day period following a halving has been the strongest for Bitcoin returns, compared to the 115 days before each event and non-halving years. Analysts at Bitfinex point to on-chain movements by long-term holders distributing supply before the halving, suggesting that some price expectations were already built into the market. They believe the current quiet market conditions are expected as we move into the traditionally slower summer period.
Jake Ostrovskis, an OTC Trader at Wintermute, suggests that the halving’s impact on the price should be viewed from a long-term perspective. He points to heavy call demand at $100,000 in December 2024, and $200,000, in March 2025, indicating that this viewpoint remains relevant.