Is History Repeating Itself? Bitcoin’s Rising 100 Days After the Halving

The crypto community is officially celebrating July 29 as it marks 100 days since the Bitcoin blockchain conducted its fourth mining reward halving.

The reason is this: According to research by ETC Group, the bullish effect of the halving-induced slowdown in Bitcoin’s (BTC) supply expansion tends to start after 100 days.

Bitcoin mining reward halving is an internal code that goes into effect every four years or after 210,000 blocks have been mined on the blockchain. The quadrennial event reduces the reward miners receive for verifying transactions by 50 percent.

The primary goal is to keep the supply of bitcoin under control and ensure that it becomes rare over time, unlike fiat currencies which have an ever-increasing supply (inflation). Bitcoin’s supply is capped at 21 million, and the reward halving helps manage how quickly this limit is reached.

The first halving, implemented in 2012, reduced the per-block reward paid to miners from 50 BTC to 25 BTC. The next two halvings reduced the per-block supply to 6.25 BTC. The most recent halving, implemented on April 20, reduced it to 3,125 BTC.

Previous halvings have paved the way for extended price rallies, with most gains coming after the first 100 days.

Andre Dragosch, head of research at ETC Group, said: “Today is exactly the hundredth day after the Bitcoin Halving event on April 20. The halving supply gap will then start to affect the market.”

Dragosch reached this conclusion by combing through performance data before and after the three previous halvings, implemented in 2012, 2016 and 2020.

The study showed that average overperformance – the difference between X number of days post-halving and X number of days pre-halving – increased significantly and reached statistical significance 100 days after the halving, with “T-values” exceeding 2%.

The t-value is a statistical figure used in hypothesis testing to determine how far the sample mean is from the population mean and is stabilized by the variability of the sample.

“The key takeaway is that the performance difference becomes statistically significant (T-value > 2) 100 days after the halving, and becomes increasingly significant up until 400 days later,” Dragosch said.

The chart shows that the average overperformance rose above 100% from day 100 after the halving, eventually reaching four digits.

It is not yet clear whether history will repeat itself.