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Bitcoin could see a steady price increase after its halving event on lower selling pressure and new interest in native Bitcoin-based applications.
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Ordinals have revitalized Bitcoin on-chain activity and bolstered fundamentals while buying demand from spot bitcoin exchange-traded funds (ETFs), which are likely to support higher prices in the future.
Bitcoin's (BTC) technical fundamentals and use cases have significantly increased in the past year and likely made the asset “stronger” ahead of its historically bullish halving event compared to previous years, crypto asset management Grayscale said in a research note last week.
“Despite miner revenue challenges in the short term, fundamental on-chain activity and positive market structure updates make this halving different on a fundamental level,” researcher Michael Zhao said. “While it has long been heralded as digital gold, recent developments suggest that bitcoin is evolving into something even more significant.”
Halving is part of the Bitcoin network's code to reduce inflationary pressure on the cryptocurrency and will cut the rewards in half for successfully mining a bitcoin block. This makes obtaining or mining new bitcoin much harder – and has historically preceded bull runs.