The current price action of Bitcoin is heavily influenced by two key factors: the introduction of US spot Bitcoin Exchange-Traded Funds (ETFs) and the highly-anticipated rewards-halving event.

Elitsa Taskova, Chief Product Officer at Nexo, has outlined two contrasting scenarios for Bitcoin’s price trajectory post-halving. In an optimistic outlook, if miners can leverage their holdings without directly selling, Bitcoin’s price could surge to $100,000 in 2024, echoing sentiments shared by asset managers and industry experts. Conversely, a less favorable scenario could see Bitcoin revisiting support levels around $40,000, particularly if mining facilities are compelled to liquidate assets for operational funding.

The introduction of ETFs has played a significant role in propelling Bitcoin to unprecedented heights, marking several all-time peaks in a short period. However, as the ETF fervor slightly diminishes, attention within the crypto community shifts towards the impending halving event, which is anticipated to significantly impact Bitcoin’s future price trajectory.

This upcoming halving holds unique significance as it is the first to follow an ETF-led rally in Bitcoin’s history. Typically, the effects of reduced mining rewards on Bitcoin’s price are observed approximately six months post-halving. Yet, with the backdrop of prior ETF-induced growth, predictions become more speculative, navigating through uncharted territories.

Overall, the halving event is expected to usher in major shifts within the Bitcoin mining industry. The future direction of Bitcoin’s value could either establish a new price equilibrium, providing support to miners amidst their considerable energy costs, or trigger a sell-off to maintain operational liquidity.

Furthermore, the significant purchasing influence of ETFs is anticipated to outweigh the usual impact of supply constriction typically associated with halvings. As we approach a stage in the market cycle where supply dynamics are increasingly influenced by the actions of long-term holders, their decisions to sell or hold become pivotal in shaping market liquidity and sentiment.

The achievement of a record peak before the halving introduces a novel scenario, yet the cycle’s evolution mirrors previous patterns when compared with the highs observed in April 2021.