Capriole Fund founder and crypto analyst has an interesting take on the price of bitcoin (BTC).
Edwards predicts that the historical price low of $41,200 will be reached in just five months. He draws this conclusion from bitcoin’s electricity cost, the raw energy cost of mining bitcoin, which he believes will double overnight, possibly in April 2024.
The Capriole Fund founder believes this certainty could cause inefficient miners to start shutting down as bitcoin’s reward halves.
Eleven years ago today, the first bitcoin halving took place. Subsequent halves took place in 2016 and 2020, and the next one is expected in April 2024.
According to Edwards, in the last two halvings, the cost of electricity bottomed out at +65% and +50% of its pre-halving value. If this happens again, and the electrical cost bottoms out at +50% this time, Edwards predicts that bitcoin’s historical price floor will be $41,200 in just five months.
One of the most anticipated events on the bitcoin calendar is the halving event, which occurs every 210,000 blocks and slows the rate of new currency issuance by 50%. The next BTC halving is scheduled to occur at a block level of 840,000; however, the actual date and time are unknown.
Based on the current average block interval, Glassnode, an on-chain analytics startup, estimates a likely date of April 23, 2024.
Expectations are rising ahead of this event, which has positive implications both before and after. In previous cycles, bitcoin had an annual return profile of over 400% following the halving event. However, past performance is no guarantee of future results.
At the time of writing, bitcoin (BTC) was up 0.35% at $37,191.
