The Fourth Halving

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@Sakura please summarize this article, thanks uwu.

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Reading https://insights.glassnode.com/the-week-onchain-week-17-2024/

TLDR :cherry_blossom:

The fourth Bitcoin halving has occurred, reducing the supply inflation rate by 50% and making Bitcoin more scarce than gold. Despite the diminishing growth rates across various network metrics, the absolute values continue to reach new all-time highs, showcasing the impressive expansion of the Bitcoin ecosystem.

Key Points :dizzy:

  • The fourth Bitcoin halving has reduced the block subsidy from 6.25 BTC to 3.125 BTC, lowering the annualized inflation rate to 0.85%.
  • Bitcoin’s steady-state issuance rate (0.83%) is now lower than gold’s (~2.3%), making it the scarcest asset.
  • Price performance across halving epochs has shown diminishing returns, but the current cycle has decisively broken the previous all-time high before the halving.
  • Fundamental network metrics like hashrate, miner revenues, liquidity, and settlement volumes have continued to grow, albeit at a slower pace.
  • Investor profitability has improved, with the average BTC holding a 126% paper gain moving into the halving.

In-depth Summary :crescent_moon:

The fourth Bitcoin halving has been a significant milestone, reducing the supply inflation rate by 50% and making Bitcoin more scarce than gold for the first time. While the growth rates across various network metrics have slowed down, the absolute values continue to reach new all-time highs, showcasing the impressive expansion of the Bitcoin ecosystem.

The price performance across halving epochs has shown a diminishing returns pattern, with the current cycle experiencing a 569% increase from the cycle low to the halving, compared to 5,315% and 1,336% in the previous two epochs. However, the current cycle has been the only one to decisively break the previous all-time high before the halving event, indicating strong demand and investor confidence.

Fundamental network metrics, such as hashrate, miner revenues, liquidity, and settlement volumes, have also continued to grow, albeit at a slower pace. The hashrate, which represents the collective “firepower” of the mining cohort, has been at or near new all-time highs entering each halving event, suggesting ongoing investment in mining infrastructure. Miner revenues have also increased by an order of magnitude over the previous epoch, reaching a staggering $3 billion in cumulative revenue over the past four years.

Investor profitability has also improved, with the average BTC holding a 126% paper gain moving into the halving, the largest it has ever been. This suggests that investors are holding significant unrealized profits, which could impact their behavior and market dynamics in the aftermath of the halving.

Writer’s Main Point :star2:

The fourth Bitcoin halving has been a significant milestone, reducing the supply inflation rate and making Bitcoin more scarce than gold. Despite the diminishing growth rates across various network metrics, the absolute values continue to reach new all-time highs, showcasing the impressive expansion and resilience of the Bitcoin ecosystem.