Back in December, I predicted that Bitcoin would hit $130,000 this year. I wrote:
“Bitcoin to $130,000
Bitcoin halving is coming on April 7, 2024. This is when the payment of Bitcoin to miners gets cut in half. This reduces supply and gives speculators a reason to buy. Bitcoin halving has occurred four times in total. Each time it happens the crypto coin has gone up anywhere from 600% to 3000%.
Furthermore, each time there is a halving event Bitcoin goes up about half as much as it did the prior time. After some basic math, this gives us a forecast of $130,000 per bitcoin. There are other stocks that should do well or better, such as the BTC miners.“
When I made that prediction, Bitcoin was trading at around $41,000. It’s up 60% in under four months given the current price of ~$66,000.
On Friday I told you to buy bitcoin again on the investment theory that traditionally most gains come after halving day.
Don’t Believe the Fat Cats
Many analysts have stated that bitcoin halving is already priced into bitcoin. These include the big shots at JPMorgan and Deutsche Bank.
Of course, these old established trading banks have different motivations than what they want you to believe. They will tell you not to buy, while they are loading up, and not to sell while they sell hand over fist. And of course, during crashes, they will scream hold and dollar cost average all the while selling every bounce.
Whenever these large Wall Street banks and charismatic heads of hedge funds show up on the TV to pontificate and pronounce, I assume they are playing a game to enhance their year-end bonus.
And so despite the obvious gains recorded after each of the last four halving events, it is hard to believe anyone who says the gains are priced in.
Don’t believe me? Just look at the history:
History of Halving
The first halving occurred in November of 2012. The mining reward was reduced from 50 to 25 bitcoins per block. After the halving, the price of Bitcoin catapulted from $10.59 to $126.24 within 180 days and hit $1,120 by October 2013.
The second halving occurred in July of 2016. Bitcoin was much more popular at this point. The second halving reduced the block reward to miners to 12.5 bitcoins. Following this halving, bitcoin price took off, peaking at over $1002.92 and laying the groundwork for the massive gains of 2017 where it topped out at $13,880.
It was during the second halving that I recommended my readers by Bitcoin at $459.
The third halving occurred in May 2020. The reward dropped to 6.25 bitcoins per block. With a backdrop of COVID-19, this halving was uncertain. And yet the cryptocurrency reached new all-time highs of $14,849.09 within 180 days and hit $61,000 in September of 2021.
The fourth halving occurred last Friday the 19th of April 2024. You could have bought Bitcoin for $63,526. The reward dropped to 3.125 bitcoins per block. Bitcoin is now trading for $66347.
It should be noted that during the first three halvings, the cryptocurrency was up six months later — but it didn’t top out after going parabolic until about 14 months later. So you should expect some sideways to modest gains over the next few months as we await the bullish surge.
As I told you on Friday, price targets range from $120,000 to $1.5 million.
Though, Cramer for one doubts that Bitcoin will ever hit $1 million. He tweeted:
This tweet, of course, fired up that one sector of the internet mob whose raison d’etre is to point out when Cramer is wrong. It should be noted that the inverse Cramer tracking fund (SJIM) has been liquidated and closed. Jim must have got a kick out of that news.
For your records, the next Bitcoin halving will be in 1433 days.
All the best,
Christian DeHaemer
The Outsider Club
