Markets

Expert advice on investment strategy for Bitcoin Halving

The cyclical market moves of the cryptocurrency are driven by the halving of the ordinary Bitcoin (BTC). With the crypto winter coming to an end, investors waiting for the next bull market are pondering their next investment.

BeInCrypto asked seasoned experts to share their investment theses. Here are the cryptocurrencies they recommend buying to take advantage of the next bull market cycle.

When is the next bull market?

The cryptocurrency community argues that the Bitcoin halving leads to market growth cycles. Each halving halves the mining rate of bitcoins.

Bitcoin supply is limited to 21 million coins. Investors assume that the next halving in the spring of 2024 will start a new growth cycle for the market.

Time Until Bitcoin Halve 2024 And Estimated Date | source: bitcoinblockhalf.com

Why and how does a halving start a growth cycle?

Bitcoin and the broader digital asset market are growing for the following reasons:

  • Dividing in half divides the Bitcoin emission rate by a factor of two. At the same time, the demand for the cryptocurrency remains the same. This artificial scarcity increases the prices of all cryptocurrencies.
  • BTC has already experienced halvings in 2012, 2016 and 2022. Bitcoin’s previous post-halving record highs made investors optimistic about next year’s spring halving. Positive sentiment ahead of the halving may spur an initial rally in the market.
  • Bitcoin is the largest cryptocurrency by market cap. BTC’s consistent tracking of altcoins suggests that it will follow the asset into bullish territory.

Now, let’s dive into the theory. Bitcoin halving occurs every 210,000 blocks mined on the Bitcoin blockchain. This period is roughly equivalent to once every four years. Previous halvings have grown the entire cryptocurrency market. Bitcoin’s rainbow chart intuitively shows the trend:

Bitcoin rainbow chart
Bitcoin Rainbow Chart | source: Blockchainenter.network

The graph can be interpreted as follows:

  • The blue vertical lines are half of the dates. The rightmost line indicates the date of the next halving, assuming that the BTC network speed does not change significantly in 2024.
  • The black curve tracks Bitcoin price changes in relation to the halving period.
  • The colors of the rainbow determine whether Bitcoin is overvalued or undervalued. Investors judge a coin’s long-term investment potential by how close its price is to the edge of the blue rainbow. Conversely, a crypto asset can be considered overvalued whenever its price gets close to the red border.

Which cryptocurrency to buy: expert opinions

Nikolai Zhoralev, CEO of CFA.RF, told BeInCrypto his opinion on which cryptocurrency will give investors the highest returns around the Bitcoin halving. He said that the basis of the investment portfolio should be BTC and Ethereum (ETH). he wrote:

“By holding Bitcoin and Ethereum, you get a balanced return to risk ratio. Therefore, I recommend other cryptocurrencies only when you are looking for profit without paying attention to the risks.”

Our expert also talked about his reasons for choosing it.

  • Bitcoin will be the main beneficiary of the halving. The standard deviation of BTC is lower than most other cryptocurrencies, with the exception of stablecoins. Bitcoin is the better option in the current environment, as its positive returns are likely to be high if you decide to hold on to BTC for at least a few years.
  • Ethereum is the second largest cryptocurrency by market cap and deserves attention. Although ETH is more volatile than BTC, it is a well-established project that has survived many crypto market cycles and even surpassed Bitcoin once. The project is at the forefront of developing Web3 and blockchain technologies. However, the most important feature of Ethereum is that thousands of cryptocurrency projects require ETH to be paid for gas.

Another cryptocurrency worth buying, according to Nikolay Zhuravlev, is Loopring (LRC). It solves the problem of congestion of the Ethereum network. In our conversation, he believes that amid the expected increase in ETH tonnage during the next growth cycle, “Loopring will provide disproportionately higher returns than the rest of the market.”

Don’t forget about bitcoin

Yaroslav Ivanov, Strategic Director at ALTA – Blockchain Accelerator & DLT Mass. Like Nikolai Zhuravlev, he emphasized Bitcoin in the first place. In response to which cryptocurrency to buy before the halving in 2024, he said:

The majority of the wallet must be in Bitcoin. The middle part should be in Ethereum, and other coins such as Waves, XRP, Dash and Mana should not exceed 15% of the total (investment). It is also worth considering altcoins with high potential, such as Aptos, Zilliqa and other serious fund-backed funds with a long-term institutional strategy.”

Dmitry Noskov, cryptocurrency expert at StormGain, joined the discussion. Here’s how it answers the question of which cryptocurrency to buy in order to profit from the next growth cycle:

“Bitcoin, in anticipation of the halving in 2024, may also pull other popular currencies. Therefore, if we highlight other currencies that have a chance of growth in the near future besides Bitcoin, they are mainly Ethereum, which has temporarily crossed the $2,000 mark, and Litecoin, which has grown above $90 and is targeting the $100 level.”

In summary

The three experts gave similar advice. According to our participants, the focus should be on BTC. Ethereum comes in second. Market capitalization leaders should make up the largest part of the investment portfolio.

Among other cryptocurrencies that could be profitable during the period of market growth after the Bitcoin halving, the respondents of the survey highlighted the following:

  • Litecoin (LTC)
  • Aptos (APT)
  • Zilliqa (ZIL)
  • waves (waves)
  • Ripple XRP
  • dash (dash)
  • Decentraland (MANA)
  • Loopring (LRC)

For the latest Bitcoin (BTC) analysis from BeInCrypto, click here.

Disclaimer

Adhering to the Trust Project’s guidelines, BeInCrypto is committed to providing unbiased and transparent reporting. This news article aims to provide accurate and timely information. However, readers are advised to independently check the facts and consult with a professional before making any decisions based on this content.

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