2020 has been mentioned about Bitcoin for perhaps two years back. The reason is halving, which will occur in May 2020 and will significantly affect the remuneration of the most famous cryptocurrency. This will be reduced by half from 12.5 BTC to 6.25 BTC per block extracted. Although at first glance it looks like a negative news, for the previous two halving this fundament had a significant positive impact on Bitcoin.
None of us can predict whether halving will positively or negatively affect the price of Bitcoin. What is certain is that it will happen and that Bitcoin miners have a crucial period ahead. In addition to halving, however, we should also follow other important fundamentals in 2020 that will tell us a lot about how healthy the Bitcoin market is. Crypto Slate listed the most important:
- Bitcoin network Hashrate
- Total number of unique addresses on the BTC blockchain
- Progress in the development of institutional infrastructure
Hashrate is the computational power that is spent to extract a new BTC block. The good news is that with little fluctuation, virtually all of last year, the average hashrate grew and reached new historical records, which means, among other things:
- Miners’ interest in Bitcoin mining is increasing
- The higher the hashrate, the safer Bitcoin is because it is resistant to the so-called 51% attack
The question is whether the Hashrate will continue to rise after halving, after which the miners get half the BTC each day than they did so far. If the price of Bitcoin fell or stagnated at its current level, many miners would be forced to shut down their facilities because mining would no longer be profitable for them. Monitoring the Hashrate rate, which expresses the overall effort to extract BTC, is therefore undoubtedly an important indicator.
Number of unique addresses
The number of active unique addresses is a key indicator of whether activity on a given network is increasing or not. According to blockchain.com, which monitors activity on Bitcoin, the number of unique active addresses on the BTC network has been relatively stable over the past two years (around 450,000). On the positive side, the number of active addresses has not decreased even after the price of the BTC has dropped from $ 20,000 to $ 3,000, and the price is still around 60% from its historical highs. If the number of active addresses increases, it will be a strong foundation for Bitcoin’s success.
Improving infrastructure for institutional investors
Speculative investors in Bitcoin believe that the institutions can launch a new bitcoin bullrun, which will drive the price of this cryptocurrency to new highs. In this respect, 2019 was an important year as new regulated platforms were created to offer institutions services that were not yet available on the cryptocurrency market. Be it Bakkt, which allows real-time Bitcoin-based Bitcoin futures investments, Fidelity Assets Management, which offers custody solutions for secure crypto currency storage, or Coinbase Custody, currently the world’s largest institutional cryptoactive manager. In 2020, it is expected that the trend for new corporate-oriented products will continue, with the result that millions of millions of billions of dollars will flow into the market. Coinbase chief Brian Armstrong has recently heard that sooner or later, any major companu in the world will hold a portion of its assets in cryptocurrencies.