According to Cointelegraph: As per the asset manager Grayscale, radical changes to Bitcoin’s demand-supply equation are poised to significantly impact cryptocurrency prices following the upcoming halving. Notably, aside from positive on-chain fundamentals, Grayscale suggests that the introduction and success of Bitcoin exchange-traded funds (ETFs) could play a vital role after the halving event.
Historically, Bitcoin's price has seen appreciable increases following halving events. However, this time, a new factor - ETFs - could influence Bitcoin's performance.
Currently, the mining rate is 6.25 Bitcoin per block, translating to about $14 billion annually, considering the Bitcoin price at $43,000. This demand level must be sustained to keep current prices stable. Post-halving, the requisite will decrease to half - only 3.125 Bitcoin mined per block, decreasing annual demand to $7 billion and thereby easing selling pressure.
The selling pressure arises from Bitcoin miners who, due to the halving's deflationary effect, find their revenues cut by half. Coincidentally, the mining costs remain consistent, if not increased, provoking miners to sell more inventory and increase supply, consequently depressing prices.
However, Grayscale believes that the recent introduction of nine Bitcoin ETFs could help offset these impacts. These ETFs, which have seen robust demand, could offer a steady demand source, absorbing additional sell pressure. The BlackRock iShares Bitcoin Trust, for instance, is leading the pack with BTC holdings valued at $4 billion.
These new dynamics, according to Grayscale, could shape Bitcoin’s market structure positively, suggesting that the reduction in selling pressure could echo the effects of another halving.
