Why bitcoin’s ‘500-day rule’ faces its biggest test yet

The "500-Day Rule," popularized by Pantera Capital in 2023, suggested that investors would historically have profited by buying bitcoin roughly 500 days before the halving and selling about 500 days afterward. The trading strategy, which has historically generated returns of up to roughly 34 times an investor’s original stake, revolves around bitcoin’s previous boom-and-bust cycles, in which reductions in newly mined supply were followed by sharp price gains.

“Bitcoin has historically bottomed 477 days prior to the halving, climbed leading into it, and then exploded to the upside afterward,” Pantera Capital said in a 2023 report . “The post-halving rallies have averaged 480 days from the halving to the peak of that next bull cycle,” the article added. A bitcoin halving is programmed to occur every 210,000 blocks , or roughly every four years, cutting the number of new bitcoin awarded to miners per block by 50%.