Crypto Price Predictions After the 2024 Bitcoin Halving: Why Fourier Series Beats VAR
Introduction to
The world of cryptocurrencies moves fast. Bitcoin, the king of crypto, saw a big change in 2024 with its latest halving event. This event cut the reward for mining new blocks in half, from 6.25 to 3.125 Bitcoins. Fewer new coins mean less supply, and with demand staying strong, prices often climb. But volatility stays high too.
Today, about 562 million people own crypto worldwide. That’s 6.8% of the global population, up 34% from last year. More big players like banks and funds are jumping in. Tight money policies around the world add pressure. All this makes predicting crypto prices tough but exciting.
After the <2024 Bitcoin Halving>, experts compared two smart tools for forecasts: Vector Autoregressive (VAR) models and Fourier Series Estimators. This post breaks it down simply. We’ll see why one tool shines brighter for bumpy crypto paths.
What is the Bitcoin Halving and Why Does it Matter?
Bitcoin halving happens every four years, or after 210,000 blocks. It slows new Bitcoin creation to control supply. Past halvings in 2012, 2016, and 2020 led to big price jumps months later. The <2024 Bitcoin Halving> on April 20 followed suit.
- Supply Shock: Miners get half the reward, so new Bitcoins slow.
- Demand Surge: Spot ETFs and company buys keep pushing prices up.
- Volatility: Prices swing wild as markets adjust.
Post-halving, Bitcoin hit new highs but faced pullbacks. Ethereum and Litecoin often follow Bitcoin’s lead.
Challenges in Forecasting Crypto Prices Post-Halving
Crypto prices don’t follow straight lines. They show cycles, shocks from news, and links between coins. Old models struggle with these twists. Studies show few looks at multi-coin forecasts right after the 2024 event.
Key issues:
- High ups and downs.
- Coins affect each other (like Ethereum moves with Bitcoin).
- Non-linear patterns and repeats over time.
To fix this, researchers tested two methods on real data from April 20, 2024, to August 12, 2025. They used daily close prices for Bitcoin, Ethereum, and Litecoin from a trusted site.
VAR Model: A Classic Tool for Linked Data
Vector Autoregressive (VAR) models shine in economics. They look at how past values of multiple items predict future ones. For crypto:
- Bitcoin’s past price affects its future and others.
- All coins feed into each other.
Variance breakdown showed Bitcoin rules. It explains 98.84% of its own surprises. Ethereum and Litecoin feel Bitcoin’s moves a lot.
But VAR assumes straight lines. Real crypto has curves and loops, so it misses some action.
Fourier Series Estimator: Capturing Waves and Cycles
Fourier Series break data into simple waves using math like cosines. It’s great for repeating patterns and non-straight trends. In crypto:
- Handles daily ups and downs.
- Models links between coins without stiff rules.
- Works well on volatile, periodic data.
This method fits crypto’s wild rides better than VAR.
Head-to-Head Comparison: Data and Results
Both models used the same daily prices for BTC, ETH, and LTC post-halving.
| Method | Strengths | MAPE Error (%) |
|---|---|---|
| VAR | Good for linear links | Higher than 3.768 |
| Fourier Series | Handles curves and cycles | 3.768 |
Mean Absolute Percentage Error (MAPE) measures accuracy. Lower is better. Fourier Series won with 3.768% MAPE. VAR lagged behind.
Why? Crypto prices post-<2024 Bitcoin Halving> have complex waves. Fourier catches them smoothly.
Key Insights from Variance Decomposition
Bitcoin drives the show:
- Short-term: 100% own shocks.
- Long-term: Still 98.84% self-made.
- ETH and LTC: Big hits from Bitcoin changes.
This shows Bitcoin as the market leader. Forecasts must start there.
Why Fourier Series is the Future for Crypto Forecasts
Fourier beats VAR in bumpy markets. It models non-linear fun without overfitting. For traders:
- Better short-term bets: Low error means tight predictions.
- Multi-coin views: See how ETH/LTC react to BTC.
- Real-world fit: Matches halving volatility.
This opens doors for better tools in finance apps and trading bots.
What Does This Mean for Investors?
Post-halving bull runs often last 12-18 months. With Fourier insights:
- Bitcoin: Expect more self-driven gains, but watch 98% own variance.
- Ethereum: Tied to BTC, but ETF flows help.
- Litecoin: Follows big brother, good for quick trades.
Tips:
- Use Fourier-like tools for your charts.
- Diversify across top coins.
- Hold through volatility for halving rewards.
These methods boost financial access, helping more people join the digital economy.
Looking Ahead: Next Halving and Beyond
2028 halving looms. Better forecasts like Fourier will guide us. As adoption grows to billions, accurate models cut risks and grow wealth.
Stay tuned for more on crypto tools. The <2024 Bitcoin Halving> changed the game—smart predictions win it.
