Founded by Janine Grainger, Easy Crypto, is shedding light on post-halving Bitcoin pricing as the fourth Bitcoin halving event provides a different market landscape for new and existing investors as the cryptocurrency reaches new all-time highs.
The first Bitcoin transaction took place in October 2009, when a Finnish computer science student, Martti Malmi, sold his 5,050 Bitcoin for $5.02. Considering today's rates, had he kept his coins, he would have been richer by circa NZD $555,500,000. This has not been the only case where early investors have made their fortunes through Bitcoin, thereby prompting a slew of eager investors to jump into the cryptocurrency market.
However, Grainger advises that new investors, or those wanting to increase their crypto portfolio, should not expect an immediate ascent in the value of Bitcoin after halving events. Past halvings have led to an increase in demand and a subsequent price surge. Nevertheless, the upward trend is not immediate, and predicting future price trajectories is complex due to variables such as market dynamics, sentiment, and regulatory factors.
After the Bitcoin halving, some analysts had predicted an immediate slump in price. Although this has not occurred, and prices have remained relatively buoyant with an increase of 9%, new investors are warned against letting disappointment drive decision-making. The volatility of the crypto market could lead to panicked selling if prices drop. Grainger states that "things often change very quickly in crypto and this is when underwhelm can lead to panic as pricing drops."
She advises new investors who are not used to the volatility of Bitcoin to avoid knee-jerk decisions. Traditional investment instruments may appear more predictable, however, adopting a broader view of volatility can be advantageous. The recent halving of Bitcoin block rewards is part of Bitcoin's well-known four-year cycle, which typically goes through phases of rising prices, falling prices, a levelling out of prices, and steady growth. Understanding this cycle could help investors when making their decisions.
Furthermore, Grainger also advocates for long-term strategies. These include dollar cost averaging, where fixed amounts are invested regularly regardless of market conditions to average out costs and reduce risk; the hold-on-for-dear-life (HODL) strategy, where assets are held long-term despite market fluctuations; and diversification, where investments are spread across different assets to minimise risk from volatile market swings.
Grainger is urging investors to confidently navigate the volatility by keeping a cool head, understanding the overall trend in the asset cycle, and playing the long game. She signs off with a reminder that "Crypto is volatile, carries risk and the value can go up and down. Past performance is not an indicator of future returns. Please do your own research."