The CEO of the cryptocurrency exchange Crypto.com, Chris Marszalek, cautioned traders about an upcoming BTC selloff as a result of the halving event. How tangible is this risk? Is it possible to somehow recognize and minimize the risk?
The upcoming Bitcoin halving on April 19-20 carries certain risks for the market. Chris Marszalek is correct that we can expect some short-term pressure on bitcoin due to the “buy the rumor, sell the news” trading pattern.”
However, history has shown that in the long term that the halving has a positive impact on the BTC price. A 50% decrease in BTC inflation after previous halving events led to price increases throughout the year following the event.
But this time around the situation might be a bit different. The emergence of spot BTC ETFs in 2024 could make for heightened institutional demand, which could offset the bearish sentiment associated with the halving. In addition, geopolitical factors and selling of accumulated bitcoins by miners might also exert a negative impact on sentiment.
Therefore, while we can expect a temporary decline in bitcoin's value following the halving, the long-term outlook remains positive. The best strategy for investors is to diversify their portfolio, avoid excessive risk, and wait patiently for the market to recover, which could occur in H2 2024 as it has in the past.
It’s also important to carefully monitor the development of the situation, the reaction of major market players and broad market trends to detect risks in time and, if necessary, adjust your investment strategy. Only an integrated approach will help minimize possible losses and take advantage of emerging opportunities. Technical analysis is also an excellent tool for timely market entry from calculated levels.