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This Metric Hints Strong Bitcoin Accumulation Before 2024 Halving

On Wednesday, April 12, the US announced its CPI data for the month of March 2023 with inflation figures staying on the expected line. The world’s largest cryptocurrency Bitcoin (BTC) has shown little volatility to this macro development and has been holding above $30,000 as of press time.

Over the last week, Bitcoin (BTC) gained more than 7% to surge past $30,000 surprising the Satoshi Street, and has been gearing up for ‘explosive growth‘ as per on-chain indicators. While everyone is paying attention to the current macro setup, popular market analyst Ali Martinez pays attention to the next big event in the Bitcoin ecosystem i.e. halving in 2024.

If past halving events are an indicator, the Bitcoin price has rallied significantly before and after the event. In Bitcoin halvings, the rewards for mining Bitcoin transactions are cut in half. Halving reduces the rate of new coins created in the market, and this reduction in the supply drives the prices higher.

However, to gain insights into the future performance of Bitcoin, one metric that investors need to carefully watch is the fees-to-rewards ratio.

Bitcoin Fess to Rewards Ratio

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Crypto analyst Ali Martinez notes that the Bitcoin fees-to-rewards ratio is a crucial indicator that shows the financial sustainability of the Bitcoin network. With block rewards decreasing after the halving event, the Bitcoin fees-to-rewards ratio becomes an extremely critical income source for miners. The crypto analyst explains:

As we can see from the above image, the market has entered a strong accumulation cycle, similar to the one we saw in 2019 and 2020. This signals a potential Bitcoin price rally coming ahead to the run-up to 2024 halving.

Note that this doesn’t mean BTC will be absolutely free of volatility. There are several major macro events up to 2024 halving which could influence the BTC price.