The October 31 is a very special date for many people around the world. For the majority of ordinary people, this date is dedicated to the Halloween party. A perfect time to have fun scaring family and friends.
However, October 31 is also the bitcoin anniversary date. Indeed, the largest cryptocurrency in the world by market capitalization had its white paper published by Satoshi Nakamoto on October 31, 2008.
Given the worldwide success that followed the creation of BTC, many believe that Halloween 2008 marked the beginning of cryptocurrencies.
In addition, the appearance of the most spooky holiday of the year gives the opportunity for another term to reappear: the Halloween effect.
What is the Halloween effect?
The Halloween Effect is basically a superstition that enjoys great popularity among traders. They think, in fact, that the Bitcoin (BTC) and the stock market as a whole are generally more efficient during the period from late October to late May.
However, the Halloween effect did not emerge with the appearance of the crypto market. Quite the contrary, its origins go far beyond the cryptocurrency space.
When we analyze the historical facts, we can easily notice that several data suggest that the winter months are usually a better time to invest in traditional assets.
Many hypotheses have emerged to justify this fact, although most are still debatable today. Some argue that the situation may be related to the fact that people, for a very long time, used to start their summer vacation in May. A factor that would have led investors to sell their investments during the same period.
Thus, the numerous studies carried out clearly show that from the month of May, the markets tend to experience a significant decline valuable. On the other hand, during the month of November, we notice the beginning of a rise in prices, as investors seek to buy assets.
What is the impact of the Halloween effect on Bitcoin in particular?
If it is true that of many investors had already associated Bitcoin with the Halloween effect in the past, it is only recently that the theory has made complete sense within the community.
Indeed, after an extensive analysis of the data history relating to the Bitcoin curve, it can be noted that during the Halloween period of the past three years, the price of BTC has increased considerably year on year.
On October 31, 2017, one BTC token was trading at 6 468 $. The cryptocurrency then had a total market cap of $107.7 billion. Just after that date, the cryptocurrency market went into an intense frenzy when Bitcoin hit an all-time high of $20,000 in December before heading back down.
However, the price of Bitcoin actually increased by around 52% between Halloween 2017 and May 1, 2018. Although it was not until Halloween 2019 that the value of the BTC token increased exponentially until reach its Halloween 2021 peak at $61,300.
Will the Halloween effect take place this year?
Between Halloween 2021 and Halloween 2022, Bitcoin lost around 65% of its value. The cryptocurrency is currently trading at a price slightly below $21,000.
For the majority of crypto experts, it would be very difficult to suggest that the token will be able to make another jump in value for a fourth consecutive year.
During a survey carried out by CoinMarketCap with its community, around 28,488 participants bet that the BTC price for Halloween 2022 would be set at 21 248 $. A price that signals a significant rise from its current price but remains a -65.17% drop from last year.
Furthermore, for reduce risk of a possible BTC token sale, investors began withdrawing their Bitcoin from the majority of cryptocurrency exchanges.
While it is true that the price of Bitcoin may not rise between Halloween 2021 et 2022, All is not bleak for the cryptocurrency market in general.
Indeed, according to research carried out by sites specializing in the industry, about 18% of Americans have already invested in a multitude of cryptocurrencies in the summer of 2022. This statistic constitutes a 125% increase compared to the 8% of Americans involved in the cryptocurrency industry in the summer of 2020.
The whales continue to accumulate Bitcoin, a good news for the bull market.