Bitcoin’s latest mining reward halving has significantly altered its market dynamics, potentially tilting the balance in favor of increased value. Following the recent reduction of mining rewards from 6.25 to 3.125 BTC per block, the daily addition of new coins has plunged, leading to a drastic supply drop. Bitfinex analysts predict that the daily supply might further decrease to $30 million, considerably less than the $150 million average inflow from U.S. spot Bitcoin ETFs. This supply squeeze, alongside a marked reduction in miner selling and increased investor custody of coins, suggests a robust demand poised to outstrip supply.

The tightening of Bitcoin’s availability is evident from on-chain data, with exchange outflows hitting peaks unseen since early 2023, indicating that many investors are shifting to cold storage in anticipation of rising prices. Despite these shifts, the anticipated pre-halving price drop has not materialized, underscoring a strong market absorption of coins. This scenario paints a potentially bullish future for Bitcoin as supply constraints and growing investor interest converge to possibly drive prices upwards.

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