- 2012 and 2016 Bitcoin halvings have followed a similar pattern pre- and post-event
- 2020 halving saw a similar pre-halving dump and post-halving jump
- All signs point to the next market cycle beginning
The Bitcoin halving managed to cut through coronavirus to make mainstream news earlier this week, but now we’re a few days past the event, how is it shaping up compared to previous halvings? We examine the fallout of the 2020 halving compared to the 2012 and 2016 halvings and what we can learn from Bitcoin’s reaction.
2012 and 2016 Halvings Reveal Pattern
If we look at the 2012 Bitcoin halving, Bitcoin experienced a 27% drop a month before the halving on November 28, following a run up in the weeks prior:
The price had already started to pick up by the time of the actual halving, recovering back to its pre-drop price just two weeks later. Following this the price continued upwards, leading to the first 2013 bull run, which saw the price top out at over 20x its halving value.
2016’s Bitcoin halving, which took place on July 9 of that year, saw a slightly different pattern, with a pre-halving dump occurring just a couple of weeks before the halving itself, dropping the Bitcoin price by 30%.
This halving also saw a post-halving dump, with the price dropping by another 29%. However, once again this was followed by a strong recovery which saw the pre-halving top reclaimed five months later. Of course, this recovery then led to the 2017 bull run which, again, saw Bitcoin making all time highs.
2020 Halving Draws Comparisons
When we compare this pattern with what has happened and what is happening with Bitcoin right now, we can see similarities:
Following Bitcoin’s pre-halving run up from $3,850 to $10,000, Bitcoin witnessed its familiar pre-halving drop just two days prior to the event itself, this time by only 20%. Whereas in previous halvings the recovery took weeks or even months, Bitcoin seems supercharged and has already recovered almost all its pre-halving losses within days. In this respect it has followed fairly closely the general pattern associated with the two Bitcoin halvings to date, with all the actions seemingly crammed into a shorter space of time.
This fast recovery suggests that Bitcoin’s fundamentals in the current climate are giving it continued strength, with the halving narrative merely encouraging its performance. If Bitcoin is to repeat its historical performance post-halving then we could be witnessing the start of the next bull run which could take us over all time highs and beyond.