A recent panel at the Swan Pacific Bitcoin festival was cleverly titled, “Are halving price cycles bullshit?” Throughout the discussion, host and founder of the Bitcoin Layer Nik Bhatia asked Marathon Digital CEO Fred Thiel, Swan CIO Ralph Zagury and Swan product manager Andy Edstrom to share their thoughts on whether the Bitcoin halving is truly a bullish event or just another narrative that novice investors buy into.
While the panel’s headline might be offputting for some, the inquiry is of great interest to all manner of Bitcoin (BTC) and cryptocurrency investors. The conventional belief held by many in the space is that the Bitcoin supply halving is a bullish phenomenon that when complete, is followed by near parabolic upside in BTC price.
Go and ask any Bitcoin lover about what they’re most excited about in the next year and if they don’t mention the chance for a spot Bitcoin ETF approval first, they’re probably going to say the upcoming halving event.
Previous Bitcoin halving events have coincided with bull markets ramping up.
But will the macro conditions be ripe for that next year in May?
~ If we are past the initial shock of a recession.
~ If a spot BTC ETF is approved.
~ If QE is back on the menu.
Then the planets will… pic.twitter.com/g5dEEKiSMF
— ecoinometrics (@ecoinometrics) September 6, 2023
While previous performance does provide some compelling evidence for what might happen in the next halving, questioning long held assertions and price expectations for a high volatility asset like Bitcoin is probably something every investor should do more often — especially when considering the number of bearish events that have occurred in the past two years.
To start the discussion, host Nik Bhatia jumped right in by asking “if the halving is the main driver of the Bitcoin price?”
Thiel quickly responded with:
“In this cycle, no, I think it’s liquidity”
Zagury agreed, adding that “flow is really what drives the market, so the halving by definition, there’s nothing on it that should impact price.” Interestingly, Edstrom took a different position by suggesting that:
“I think the halving is still bullish and we can debate what the magnitude of that effect is, but yeah, I think it still matters for price.”
Each panelist, including host Bhatia seemed to agree that while the halving may possess some market moving capacity, it could be diminishing over time. According to Bhatia,
“The halving affects supply. It is less and…