The recent panel at the Swan Pacific Bitcoin Festival titled “Are halving price cycles bullshit?” sparked a discussion among the host, Nik Bhatia, Marathon Digital CEO Fred Thiel, Swan chief investment officer Ralph Zagury, and Swan product manager Andy Edstrom, about whether the Bitcoin halving is a bullish event or just a narrative that novice crypto investors buy into. This headline has caused a stir in the crypto community, as many have long believed that the Bitcoin supply halving leads to near-parabolic upside in BTC’s price.
When asked if the halving is the main driver of the Bitcoin price, Thiel quickly responded that it is “flow, not halving, that drives the market.” Zagury echoed this opinion, adding that “the halving, by definition, there’s nothing on it that should impact price.” Edstrom, however, took a different stance, believing that the halving “can still have an impact on the crypto market.”
Ultimately, the panelists, including Bhatia, agreed that the halving may possess some market-moving capacity, though it could be diminishing over time. Bhatia concluded that “the halving is a headline generator for ai crypto investors, but it’s not the only factor that should be considered when looking at the crypto market.” As the crypto federal reserve and the crypto future become more intertwined, investors should look to the upcoming crypto events and latest crypto news to determine what may happen in the crypto market in the coming months, including the upcoming halving in May 2022.
Halving hype and hopium: Are investors’ heads in the clouds?
Investing is largely based on speculation, and while Zagury and Thiel think investors are exaggerating the potential impact of the Bitcoin halving, Edstrom sees it as a “psychological feedback loop” in terms of demand.
Crypto investors have long held the belief that derivatives are a major factor in Bitcoin’s price discovery. Bhatia asked whether derivatives had a bigger influence than spot trading on Bitcoin’s price movements, and Zagury responded:
Zagury noted that “Bitcoin is usually either stable or declining in terms of number of days, which makes it difficult to hodl because it means you’ll experience periods of both success and failure.”
Returning to the original question about derivatives and Bitcoin price discovery, Zagury said:
Liquidity will be the focal point
Despite discounting the impact of Bitcoin supply halvings on BTC’s price, each panelist expressed their positive, longer-term bullish perspectives on Bitcoin’s value.
With liquidity being the agreed-upon future price catalyst for Bitcoin, Zagury said:
When asked when and how this all-important liquidity comes back, Edstrom hinted that rising 10-year United States Treasurys, potential regional bank failures similar to the ones seen six months ago, and the increasing number of banks holding long-term government debt at a loss are all signs that a Federal Reserve pivot towards quantitative easing could occur sooner than expected.
The crypto future looks bright as investors, government, and banks become more involved in the crypto market. Latest events indicate that the crypto investor may be able to benefit from the crypto market as soon as May 2022.
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