Weekly SmartPills #45

BITCOIN AT $42,000: JPMORGAN’S ANALYSIS ON THE HALVING

According to an analysis by JPMorgan, the price of Bitcoin could drop to $42,000 after the halving. This prediction is not an isolated case, as various sources expect a correction, and the halving could be the right moment for it to materialize.
The rise in the price of Bitcoin above $60,000 in February may have been influenced both by expectations for the halving and by the impact of the new ETFs on the market. Markets may already be factoring in the halving and its effects on the price, considering it an inevitable and predictable event.

The halving, scheduled at block number 840,000, will occur in about 7,000 blocks, which should take place after mid-April. Although halving has historically led to an increase in the price of Bitcoin, the impact is not immediate and a correction could occur at the moment it happens.

JPMorgan's Analysis of Mining Costs

According to JPMorgan analyst Nikolaos Panigirtzoglou, the halving will lead to a significant reduction in revenue for Bitcoin miners, since their rewards will be cut in half.
This could lead to a reduction in costs and the adoption of more efficient mining machines, increasing mining costs.

The cost of mining Bitcoin has become a lower boundary for its market price. However, Panigirtzoglou uses the term “empirically,” since there is no direct link between mining cost and Bitcoin’s market value.
The analyst suggests that the price of Bitcoin could fall to $42,000 after the halving, once the current euphoria subsides.

Final Considerations and Possible Developments

The evolution of Bitcoin's price after the halving will depend not only on the “sell the news” effect and the current euphoria, but also on the price level from which the retracement begins.
Even though a 30% correction could be plausible, there is nothing to exclude the possibility of an even more significant retracement.
It will therefore be important to closely monitor the market over the coming months.