Question For Bitcoin OldTimers

[windjc]

For those of you around since 2011 or early 2012, what effect do you think the last halving had on price?

Looking at the charts there was a runup from mid 2012 to September 2012 where the price basically doubled from 7 to around 15.  Then, of course, was the hugely crazy bullishness of all of 2013.

Do you think the halving was the cause of one or both of these things?

Some people say that since there wasn't an immediate bump before or after the last halving, that the effect is overrated. But that theory sounds just about stupid.

I'm curious in "hindsight is 20/20" answers from people who lived it.

I ask this question because I am speculating on the effect(s) of the next halving.

[1714197228]

1714197228

[1714197228]

1714197228

[AmDD]

I don't think it has as big of an impact as most think. It's not like the number coins available is cut in half, just how many new coins are created each day is cut in half. Also everyone knows it will happen and when so its no surprise to anyone.

I say you may see a bump in price but don't expect it to double over night.

[adamstgBit]

when it was happening the general idea was that it would have no effect on price since we all knew it was going to happen long b4 it happened, it wasn't unexpected and there for "priced in" and that bitcoin was going up for far more compelling reasons.

i agree with this.

and its still true, we all know there will be less coins mined over time, it is infact a reason why people buy bitcoin in the first place (limited supply) therefor priced in at all times.

[WillyBTC]

If the halvings were so straight-forward, it would be too predictable. Many are already speculating on this point. Summer-ish 2012 shenanigans must keep pirateat40 in mind.

[botany]

Something which is known to happen would get priced in immediately, wouldn't it?
PS - I am definitely not an old timer.

[NamelessOne]

when it was happening the general idea was that it would have no effect on price since we all knew it was going to happen long b4 it happened, it wasn't unexpected and there for "priced in" and that bitcoin was going up for far more compelling reasons.

i agree with this.

and its still true, we all know there will be less coins mined over time, it is infact a reason why people buy bitcoin in the first place (limited supply) therefor priced in at all times.

Yeah, this. It always seemed price in and no real effect afterwards. Oh June 2011 how long ago you now seem. I hope to look back on this summer with the same semi sorta fondness. "Damn that sucked when the expected bubble didn't happen and the price dropped in August. Well who cares since the price is now $25,436!"

[dropt]

I'm in agreement with the other oldtimers: the halving really didn't do much in terms of price increase. 

However, I think this halving will have more of an effect, and that said effect will not necessarily be seen pre-halving.

[Benjig]

It has an impact but is not the main reason why the price went up.. neither the asic transition.

[chriswilmer]

For those of you around since 2011 or early 2012, what effect do you think the last halving had on price?

Looking at the charts there was a runup from mid 2012 to September 2012 where the price basically doubled from 7 to around 15.  Then, of course, was the hugely crazy bullishness of all of 2013.

Do you think the halving was the cause of one or both of these things?

Some people say that since there wasn't an immediate bump before or after the last halving, that the effect is overrated. But that theory sounds just about stupid.

I'm curious in "hindsight is 20/20" answers from people who lived it.

I ask this question because I am speculating on the effect(s) of the next halving.

I distinctly remember preparing for the worst. I sold all (!!!) of my bitcoins a few days before in case there was some kind of glitch in the halving process... and then I waited, and waited, with everyone else as we got to the block halving event. It worked without a hitch... and the price didn't change at all. I bought back in and then the great rally from ~$13 to $266 happened over the next several months.

[RyNinDaCleM]

I agree with all accounts that it had little effect on price at or around the time of the halving. Remember, the price was already at $31.9099 well before that so the doubling from $7is to $15.40 was just a typical Bitcoin price swing at the time. I think the huge price rise that followed a few months later was just a coincidence that it happened near the same time. It was something that (without the suppressive power of Pirateat40) may have happened much sooner. Or at the same time, without the speculation surrounding the Cypriot bank crisis, may have happened much later. Everything fell into place at the right times to allow it to be circumstantial at best.

[windjc]

Wow - so every response so far is in agreement didnt have that much of an impact. And that the bubbles that started in 2013 were absolutely not related.

Hmmm. So 1/2 the new bitcoins available on the open market and the effect is always priced in early and does not create supply issues backend.

While I think its more measurable to see that the price might not run up to a halving, I think its less measurable to see the effects of halving 3-12 months down the road. Especially with the gargantuan hashrate we have now that could be even more extreme in 2 years.

Maybe I'm crazy, but it seems that at least the last bubble was caused by a literal lack of supply. There were times in the runup where Chinese exchanges literally ran out of coins. I would think that a halving would have a potential effect here.

[byronbb]

Events that are foreseeable by all, of which everyone will draw the same conclusion, can probably only be acted upon in a contrarian manner.

[knight22]

I remember that some miners tried to convince people that halving was a bad idea and has to be changed. They created FUD that the hashrate would go down, so on the security and will ultimately doom bitcoin. That created some uncertainty around bitcoin but we all know that it finally turned out just fine as expected. It also proved that trying to remove or change the halving is pretty futile. It didn't have any effects on the price though as everybody already priced their bitcoins considering that 21M limit.

[seleme]

Of course it has effects, sooner or later.

When you have daily supply to dump on exchanges cut in half, it can't do no wrong to the price on them.

[cypherdoc]

Wow - so every response so far is in agreement didnt have that much of an impact. And that the bubbles that started in 2013 were absolutely not related.

Hmmm. So 1/2 the new bitcoins available on the open market and the effect is always priced in early and does not create supply issues backend.

While I think its more measurable to see that the price might not run up to a halving, I think its less measurable to see the effects of halving 3-12 months down the road. Especially with the gargantuan hashrate we have now that could be even more extreme in 2 years.

Maybe I'm crazy, but it seems that at least the last bubble was caused by a literal lack of supply. There were times in the runup where Chinese exchanges literally ran out of coins. I would think that a halving would have a potential effect here.

i disagree. it definitely had an effect. it's just a matter of how one defines when it kicked in.

just b/c we know we have all these halvings in front of us doesn't mean they get priced in today.  imo,there wasn't any effect until around 6 mo before the last halving (it was Nov 2012, right?).  the forward looking pricing-in effect is offset by the never ending threat of the death of Bitcoin or a gvt-led 51% attack that will wipe out the network at any moment. also like Chris said above, the fear that something might go wrong at the time of the halving.  as time gets nearer, ppl get more confident and antsie to make a front running move, which i think was about 6 mo prior to last one.  after it went off w/o a hitch, the price skyrocketed to 260 or so in April 2013.

of course, the next time will be different.

[thefunkybits]

I got interested in Bitcoin around the end of 2012, around the time of the block halving.

I've always attributed the block halving to that rise from $13 to $266 (although now I know many other factors were at work)

[cypherdoc]

I remember starting the newsletter in April 2012. I remember pleading with subs to buy all dips into the end of year in anticipation of halving. We were stuck between 4.5 and 5.4 for months until May when things started to get volatile in an upward direction, first to 15.5. I don't remember any specific news around them that would account for an immediate effect like that on the price.

[EuroTrash]

Re: summer 2012 - I believe Pirate's ponzi was one of the causes for both price surge and crash.
Anticipation of Dec 2012's reward halving might indeed have been another cause of the rise from 5 to 10. It also caused the hash rate to flex a bit (because of last GPU miners quitting I suppose)... but after reward halving, the doom scenario did not happen. So new January 2013 money came in and met a smaller offer than their demand.

TLDR: I don't know.

[WillyBTC]

Wow - so every response so far is in agreement didnt have that much of an impact. And that the bubbles that started in 2013 were absolutely not related.

Hmmm. So 1/2 the new bitcoins available on the open market and the effect is always priced in early and does not create supply issues backend.

If everyone knows there will be a future squeeze on supply, you don't think that gets priced in early? It inevitably results in diminished supply (obviously), but the % of mined coins brought to market is so miniscule as it is already. You think it would just cut that in half? I don't think so. Lots of hoarded coins waiting to fill the gaps.

[windjc]

Wow - so every response so far is in agreement didnt have that much of an impact. And that the bubbles that started in 2013 were absolutely not related.

Hmmm. So 1/2 the new bitcoins available on the open market and the effect is always priced in early and does not create supply issues backend.

If everyone knows there will be a future squeeze on supply, you don't think that gets priced in early? It inevitably results in diminished supply (obviously), but the % of mined coins brought to market is so miniscule as it is already. You think it would just cut that in half? I don't think so. Lots of hoarded coins waiting to fill the gaps.

Well if the consensus is there is no effect, then what does that tell us?

The bottom line is I dont subscribe to the notion that most of the people trading/buying/selling bitcoin have the slightest clue about what "priced in" even looks like. Quite the opposite. I think most of these people do not.

Such is the reason I wanted to get opinions.