What Happens to Emerging Markets (EEM) When Bitcoin Halves?
What happens to Bitcoin after a halving? Historical price cycles, supply shock mechanics, miner economics, and how halving interacts with macro conditions.
How Emerging Markets (EEM) Responds
Scenario Background
Every 210,000 blocks (approximately every four years), the Bitcoin block reward, the number of new bitcoins created per block, is cut in half. This is hard-coded into Bitcoin's protocol and cannot be changed. The halving reduces the rate of new supply entering the market, creating a supply shock if demand remains constant or grows. Economically, it is equivalent to gold mining output suddenly being cut in half while jewelry and central bank demand stays the same.
Read full scenario analysis →Historical Context
There have been four Bitcoin halvings: November 2012 (reward from 50 to 25 BTC), July 2016 (25 to 12.5), May 2020 (12.5 to 6.25), and April 2024 (6.25 to 3.125). Each was followed by a significant bull run. After the 2012 halving, BTC rose from $12 to $1,100 within 12 months. After the 2016 halving, BTC rose from $650 to $20,000 in 18 months. After the 2020 halving, BTC rose from $8,700 to $69,000 in 18 months. The 2024 halving occurred with BTC already near all-time highs due to ETF inflows, ma...
What to Watch For
- •Hash rate declining after the halving, miner capitulation in progress
- •BTC breaking above the pre-halving all-time high, the supply shock is being priced in
- •ETF inflows accelerating, institutional demand absorbing the reduced supply
- •BTC funding rates going deeply positive, leveraged longs building, blow-off top risk
- •Macro liquidity conditions (check the net liquidity index),determines the cycle amplitude
Other Assets When Bitcoin Halves
Other Scenarios Affecting Emerging Markets (EEM)
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