Bitcoin (BTC) becomes more scarce after each halving, but the next event that takes place in the next four days will make the digital assets twice as rare as gold, according to analysts at the leading crypto exchange, Bybit.

A report on what to expect before and after the Bitcoin halving revealed that BTC will experience a supply squeeze after the event, as the reserves on all centralized exchanges may be consumed within nine months.

Twice as Rare as Gold

Bybit said the Bitcoin stock-to-flow (S2F) model substantiates its claims as the metric has shown that BTC becomes scarcer than gold after each halving. The S2F ratio is calculated by dividing the circulating supply of a commodity by its annual production to derive a scarcity gauge.

At the time of writing, Bitcoin’s S2F ratio hovered around 56, while that of gold is 60. After the halving, Bitcoin’s ratio is expected to double to 112.

Halving slows supply by reducing the rate of BTC production, and a supply squeeze may be inevitable. Bitcoin is already seeing early signs of a short squeeze, which will worsen post-halving.

The BTC supply for spot Bitcoin exchange-traded funds (ETFs) usually comes from centralized exchanges as investors realize their profitable positions and miners sell their block rewards. When mining rewards are slashed and investors HODL their assets in cold storage or decentralized wallets, miners would refrain from selling quickly, and the sell-side supply flowing into the exchanges will decline.

A Complex Cycle

Currently, roughly two million bitcoins are in centralized exchange reserves. Assuming spot Bitcoin ETFs see daily inflows of $500 million, around 7,142 BTC will leave exchange reserves daily, indicating that the reserves will only last nine months after the halving.

“With this in mind, it’s unsurprising that Bitcoin’s price may continue to climb before the halving, or even afterward, as the supply squeeze propels the price to another new record,” Bybit said.

Although halvings are known to trigger bitcoin price rises, analysts see this cycle as complex and remain uncertain about the effect of the upcoming event as BTC already recorded a new high. Some believe the post-halving rally will be less remarkable than the market has experienced after past events.

Nevertheless, market experts believe demand will drive the BTC post-halving surge this time as spot Bitcoin ETFs achieve their full potential.