Recently, when opening the market software, isn't the screen full of voices like 'halving countdown' and 'halving must surge'? The atmosphere has built up to this point, and many friends are probably unable to contain the impulse to go all in. Stop for a moment! As an old analyst who has been in the crypto market for many years, I must remind you: there is indeed opportunity in the halving market, but there are 3 supply and demand risk points hidden behind the 'celebration' that 90% of people overlook. Once you hit them, it could very well turn you from 'making money' to 'losing money'.
The first risk point: the 'lag effect' of supply contraction is overestimated. Many people think that when supply contracts on the day of the halving, prices will immediately rise, but in reality, the impact of supply contraction on price is lagged. Historical data shows that after the last halving, prices went through a 23-day correction before truly starting to rise. Why is this? The core reason is that 'demand takes time to catch up'. On the day of the halving, the market will experience a wave of profit-taking due to 'positive news being realized', leading to insufficient short-term demand and a price correction; only when new demand funds enter the market to absorb the contracted supply will prices truly rise.
The second risk point: "False prosperity" on the demand side. The current demand data in the market seems good, with a 25% increase in trading volume on mainstream trading platforms in the past 30 days. However, a closer breakdown of the data reveals that 60% of the trading volume comes from leveraged trading, rather than real spot demand. The demand generated by leveraged trading is short-term and unstable. Once the market experiences any slight disturbance, leveraged funds will be liquidated on a large scale, leading to significant price fluctuations. More critically, the current leverage ratio of retail investors has reached 1.5 times that of the last halving, which means that the market's fragility has greatly increased, and any negative news could trigger a "domino effect" decline.
The third risk point: "Supply diversion" of alternative cryptocurrencies. Many people only focus on the halving of core cryptocurrencies, ignoring that there are currently over 20 mainstream alternative cryptocurrencies undergoing "production reduction" or "buybacks" at the same time. The supply contraction of these cryptocurrencies will also attract some demand funds, thus diverting the demand for core cryptocurrencies. From the data, in the past 45 days, the total net inflow of funds into these alternative cryptocurrencies has reached 1.2 billion, accounting for 35% of the total net inflow in the entire crypto market—this means that the pressure on the demand for core cryptocurrencies has further increased, making it difficult to attract most funds from the market like the last halving.
From the core logic of supply and demand balance, the current market's "supply-demand gap" is not obvious: the expected supply contraction of core cryptocurrencies is offset by the false prosperity on the demand side and the supply diversion of alternative cryptocurrencies. My personal view is that the upward space for this halving market will be much smaller than the last one, and the volatility will be greater. For ordinary retail investors, the best strategy is not to go all in but to layout in batches while strictly controlling leverage to avoid being shaken out by short-term fluctuations.
Specific operational advice: Before the halving, you can first establish a 30% position, observing the direction of funds and changes in trading volume after the halving; if funds continue to net inflow after the halving and trading volume steadily increases, then gradually increase the position to 50%-60%; if funds continue to net outflow and trading volume shrinks, decisively cut losses and exit. Remember, the survival rule in the crypto market is "survive first, then talk about making money."
Finally, I want to remind everyone: don't be blinded by the "carnival atmosphere" of the market; data is the most real teacher. Follow me @链上标哥 , so you don’t get lost! I will analyze the core supply and demand data of the halving market every day to help you identify risks and seize opportunities. If you think this article can help you avoid pitfalls, be sure to like, follow, and share it with friends who are struggling with whether to enter the market—every like you give is the motivation for me to continue providing hardcore content!
