Bitcoin witnessed a notable downturn after achieving an unprecedented all-time high on Tuesday, as investors opted to secure profits amidst the cryptocurrency’s remarkable surge. Despite this correction, overall market sentiment remains optimistic in anticipation of the upcoming halvening event.
On Tuesday, Bitcoin (BitfinexUSD) registered a decline of 8%, settling at $61,682 subsequent to reaching its record peak of $68,874 earlier in the day. The pullback was attributed to the actions of significant investors, commonly referred to as “bitcoin whales,” who appeared to capitalize on the recent surge in value. Nonetheless, prevailing sentiment remains positive, fueled by expectations of Bitcoin embarking on another upward trajectory leading up to the halvening event projected for April.
Halvening events, occurring approximately every four years, involve a reduction in the number of bitcoins in circulation. Historical data indicates that halvening events in 2012, 2016, and 2020 preceded notable bull runs for Bitcoin.
The recent historic high in Bitcoin’s value closely followed the launch of a spot-based bitcoin exchange-traded fund (ETF) in January, intensifying demand for the cryptocurrency, particularly among institutional investors. Notably, data from BitMex Research revealed that bitcoin ETFs in the United States collectively hold nearly 4% of the total bitcoin supply in circulation.
