Bitcoin Rally after Halving Fails to Materialize. Bitcoin ETFs Also in the red

The price curve of Bitcoin (BTC) has lost positive momentum. Experts explain this with two reasons: the usual influence of the halving has become obsolete and the new ETFs are losing capital.

The good mood on the crypto markets has evaporated, the leading currency Bitcoin (BTC) has closed many trading days in the red and has been trading below the psychologically important mark of $60,000 since the end of August. At the end of July, Bitcoin was still worth $70,000.

When assessing the situation, two influences are currently noticeable from the perspective of the crypto scene:

According to data from SoSo, the Bitcoin ETFs, which have only been traded since January, last saw an inflow of capital on August 26th, and investors have been liquidating positions since then. On average, Bitcoin ETFs are currently losing around $100 million in capital on stock exchange working days.

Measured against Bitcoin’s market capitalization of $1.1 billion, these are not huge amounts, but the psychological factor should not be underestimated. Anyone who thought that Bitcoin ETFs would ensure a steady inflow of capital as they did in their early months will now be proven wrong.

Many investors had expected that the Bitcoin Halving, which only takes place every four years, would have positive effects on the price development of BTC as in the past. But that has not happened since the most recent Halving took place in the second half of April. Analysts at Outlier Ventures published a report this week with the headline “Bitcoin Halving. The four-year cycle is dead.”

The report compares the four previous Bitcoin halvings. As is the case now, 125 days after the halving, Bitcoin had gained a good 700 percent in 2012, in 2016 it was plus 10 percent and in 2020 around 22 percent. But in 2024, four months after the halving, the price curve of BTC is minus 8 percent in the charts. Even before this year’s halving, there was a lively debate about whether the event was losing relevance .

Outlier Ventures believes that 2020 is already a special case because at that time money was distributed generously in the USA and other countries to cushion the economic consequences of the Corona crisis. They differentiate: The Bitcoin halving was previously able to influence the BTC price curve from the supply side, but this weakened. The Bitcoin ETFs, on the other hand, were able to increase demand, but this trend is currently running out.

Conclusion: Bitcoin hopes for momentum

Following the Bitcoin halving, BTC had in the past reached a new all-time high each time, albeit with a time delay. In 2024, a different dynamic set in. Driven by the initial success of the BTC ETFs, Bitcoin rose to a new record price of just under $74,000 in mid-March, a month before the halving.

Some observers believe that this shows how the ETFs have overtaken the halving in terms of importance. They now cite price levels of $56,000 and $49,000 as critical support levels for Bitcoin. But of course there are also optimists who predict a renewed Bitcoin upswing from October after the summer holidays and hope for support from the US presidential race. The fact is: At current prices of around $57,000, Bitcoin seems to be trading at a level that reacts nervously to external influences.

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(Featured image by TamimTaban via Pixabay)

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