The Bitcoinย (BTC) network is scheduled to undertake its fourth halving in less than a year, and the speculations on whether it will have an impact on the assetโs price have already begun.
After all, Bitcoin went on a wild run after the previous 3 examples. Onย theย otherย hand, what does ChatGPT think about it?
Why Does the Bitcoinย (BTC) Halving Matter?
Upon creating the Bitcoinย (BTC) network, Satoshi Nakamoto incorporated an event happening at every 210,000 blocks (around four years) that essentially guarantees that the annual supply will be slashed in half.
The 1st one reduced the block bonus from 50 Bitcoin to 25 BTC, the Second (25 -> 12.5), and the third drove them down to theย present 6.25. Thisย implies that the digitalย currencyโs current inflation levels are under 2 percent and will go further down as the bonus will be 3.125 Bitcoin after the 2024 halving.
Despiteย theย factย that there are greaterย than 19 Million Bitcoin mined already out of the total 21 Million supply ever to exist, the halvings make it so that the last mined Bitcoinย (BTC) will be after greaterย than 100 years from now.
Basic regulations of economics dictate that if the supply of an investment declines while the demand remains the same or increases, itsย value should, at least in theory, rise.
This is perhaps why the previous 3 halvings acted as catalysts for the substantial bull runs. Looking at Bitcoinโs historical data shows that the investment traded at around $12 on November 2012 ( 1st halving) and exploded by almost 100x duringย a year to nearly $1,000.
July 9, 2016, was the date of the Second halving, and 1 Bitcoin was worth around $670. A year thereafter โ it stood at over $2,500. Bitcoinย (BTC) traded at just under $9,000 during the May 2020 halving, and it skyrocketed to $69,000 within just over a year. Regardlessย of plummeting hard in theย following few years, Bitcoin isย still approximately 3x higher than itsย value during the last halving.
Given these price performances, the cryptocurrency community often speculates that bitcoinโs next bull run should begin somewhere within theย following year, as the fourth halving is scheduled to take place in April 2024, reportsย by the current estimations.
ChatGPT on Bitcoinโs Halving
Consequently, we decided to ask ChatGPT for its take on the matter, given its significance. The highly- trending Artificialย Intelligenceย (AI) chatbot was relatively careful in its wording, responding that it doesnโt have โaccess to real-time data or theย potential to predict future events such as BTCโs price.โ
It further pointedย outย that Bitcoinโs price is impacted by plentyย of factors, including:
- Market Demand
- Investors Sentiment
- Adoption Rates
- Regulatory Developments
- Technological Advancements
- Macroeconomic Conditions
Nevertheless, ChatGPT admitted that Bitcoinโs price โhas shown both increases and decreases surrounding halving eventsโ and added:
โDuring the halving, the block reward for miners is reduced, which can impact the supply dynamics of Bitcoin. The reduction in supply, coupled with continued demand or increased market interest, has theย capacity to contribute to upward price movements.โ
Nonetheless, the Artificialย Intelligenceย (AI) chatbot likewise warned that โitโs criticalย to note that past performance is not indicative of future results.โ
Inย theย end, ChatGPT touched upon something critical about every investment, not just BTC. It stated people should do thorough research before allocating funds to any assets and not just rely on one source of information.
You can find more of our ChatGPT-related content โ here, here, and here.
