DefiDive - 6 Reasons Bitcoin Will Hit $200k After the Halving

As Bitcoin approaches its fourth halving in April, anticipation mounts regarding its trajectory post-event. With predictions ranging from $3.8 million per Bitcoin (Cathie Woods of Ark Investment) to being worthless (Jamie Dimon of JP Morgan), the whole community is engaged in the event.

With the halving set to reduce Bitcoin’s mining rewards to 3.125 BTC per block, a critical shift is occurring in its economic landscape further flattening its supply curve and accelerating the transition from an inflationary to a deflationary asset. As time goes by and the scarcity of each Bitcoin increases, natural economic forces will act to push prices upwards in response to increasing demand.

Amidst a macroeconomic cultural shift, traditional investments like real estate, once favoured by baby boomers, are losing appeal among millennials and Gen Zers. Instead, the new generations are increasingly turning to cryptocurrencies as an alternative investment. They are drawn by the perceived advantages of greater flexibility, lower barriers to entry and potentially higher returns.

From a code perspective, the protocol adjustment that will occur on block 840,000 is a relatively minor event. In prior halvings, scepticism towards the technology and its reliability were constantly questioned. Each halving event is psychologically associated with a proven track record that yet again, Bitcoin will execute against its intended purpose promised in the original whitepaper back in 2008. As an asset class, Bitcoin is still in its infancy and halvings bring a boost of confidence to outside observers and those not yet invested.

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