Bitcoin’s price experienced a rebound following the release of April’s Consumer Price Index (CPI) data, which showed a slight easing of inflation. The CPI measures the average change in customer pricing for goods and services over time, serving as an early indicator of inflationary pressures. In response to this data, Bitcoin saw a 7% spike in its price, reaching $65,152.
Analysts are now looking at how Bitcoin mining will react to the 2024 halving event, which reduces miners’ incentives by 50%. Historical patterns suggest that Bitcoin miner revenue recovers 2-5 months after a halving, leading to a consolidation phase before Bitcoin’s price surges.
Efficient miners are expected to survive the halving, operating on fatter margins and avoiding the need to sell their BTC. This dynamic is anticipated to reduce miner sell pressure, ultimately benefiting Bitcoin’s price. However, it may take 2-5 months for the new supply/demand balance to reflect in Bitcoin’s price.
Bitcoin is currently trading at $66,252, up by 6.7% in the past 24 hours, with trading volume also increasing by 77.8% to $42.8 billion, indicating renewed investor interest.
In terms of advancements in Bitcoin mining, Block Inc. has developed a 3nm mining chip to enhance its mining technology, aiming to improve decentralization and mining efficiency. This development comes at a time when US President Joe Biden has proposed a 30% excise tax on electricity used by miners, drawing criticism from the crypto community for potentially hindering Bitcoin mining in the US.