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Bitcoin Demand Will Push Price Up, Not the Halving: CryptoQuant

2 mins
Updated by Bary Rahma
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In Brief

  • Bitcoin halving reduces new issuance but its price impact is diminishing.
  • Demand growth from large and permanent holders is the key price driver.
  • Post-halving, demand from holders outpaces issuance for the first time.
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The anticipated Bitcoin halving is just two weeks away. While historically, it has signaled the start of a price acceleration phase, analysts at CryptoQuant argue that its impact is waning.

The forthcoming halving will reduce the new issuance by 14,000 BTC on a monthly basis, traditionally decreasing sell pressure from miners. However, the once-significant influence of halvings on Bitcoin prices seems to diminish as the new issuance becomes smaller relative to the total supply available for sale.

Bitcoin Halving Influence Wanes

Long-term holders (LTH) selling, for instance, has averaged 417,000 BTC per month in the last year, overshadowing the monthly issuance of 28,000. In contrast, CryptoQuant highlights that Bitcoin demand growth, particularly from large holders or whales, is emerging as the primary driver for higher prices post-halving.

This cohort of investors is currently showing the highest-ever demand growth, which has historically fueled price rallies.

“In previous cycles, Bitcoin demand growth from large holders or whales has spiked, fueling the price rally. Currently, demand growth is around the highest ever, around 11% month over month,” analyst at CryptoQuant told BeInCrypto.

Read more: Bitcoin Halving Countdown

Bitcoin Whales Holdings
Bitcoin Whales Holdings. Source: CryptoQuant

Moreover, the demand for Bitcoin from permanent holders has outpaced issuance for the first time in history. This adds further fuel for a potential Bitcoin price rally after the halving.

Permanent holders now add as much as 200,000 BTC monthly to their balances. This is significantly more than the approximately 28,000 BTC monthly issuance, which will further decrease to about 14,000 post-halving.

CryptoQuant also points out that the monthly issuance of Bitcoin has dwindled to just 4% of the total Bitcoin available supply. This starkly contrasts the periods before the first, second, and third halvings, where issuance represented 69%, 27%, and 10% of the total supply, respectively.

Read more: What Happened at the Last Bitcoin Halving? Predictions for 2024

Bitcoin Long-Term Holder Supply
Bitcoin Long-Term Holder Supply. Source: CryptoQuant

In summary, while the upcoming Bitcoin halving will reduce the new issuance of BTC, leading to less selling pressure from miners, the unprecedented demand growth from large holders and permanent holders is poised to be the key driver for higher prices post-halving.

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In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Bary Rahma
Bary Rahman, a talented journalist, graduated from New York University with a degree in Journalism. Skilled in SEO, she has worked with CNN, showcasing her investigative skills and storytelling abilities. In addition to her journalistic accomplishments, Bary has contributed her expertise as a content writer for Binance, crafting insightful articles on the dynamic crypto industry. Her unique fusion of journalism and SEO makes her a versatile and highly respected figure in the industry.