“Before Bitcoin Halving: What Will It Bring for the Cryptocurrency Market?”

The Phenomenon of Bitcoin Halving – What Does It Mean for the Cryptocurrency Market?

The upcoming Bitcoin halving, which involves cutting the block reward in half, is generating significant interest among cryptocurrency market participants, especially professional traders. Historically, the anticipation of halving has favored bullish sentiment, but not necessarily directly on the day the event occurs.

The Delayed Impact of Mining Supply Reduction

The impact of Bitcoin’s mining supply reduction on the market may be delayed, as mining operations typically do not sell off all mined resources daily but rather accumulate them, waiting for potential price increases in the market.

Analysts’ Warnings and Market Options

Some analysts caution against expecting a straightforward price hike post-halving, noting that Bitcoin’s price trajectory is influenced by many external variables. Call options with a neutral to bullish stance dominate the market, expiring on June 28th.

The open option interest on Deribit until June 28th reached an impressive $4.5 billion, with a significant bias towards call options over puts. There are even call options targeting $140,000 and $200,000 by June 28th, which may seem overly ambitious to some investors.

Skepticism Towards the “Death Spiral” and the Current Market Situation

Speculations about a “death spiral” are dismissed, mainly due to the flexibility of the Bitcoin network and its difficulty adjustment system every 2016 blocks. Currently, demand for put options with a strike above $57,000 is low, indicating a general optimism in the cryptocurrency market. The market currently appears to lean towards neutral-to-bullish strategies ahead of the upcoming Bitcoin halving, a trend that can be observed at least until the options expire in June.