The third Bitcoin halving is closer than ever before and we can feel a lot of tension in the cryptocurrency market. Many fans expect halving to help Bitcoin overcome the long-term downward trendline that has been limiting us since the end of 2017.
Less than 10,000 blocks to go!— Jimmy Song (송재준) (@jimmysong) March 3, 2020
However, the market turned after 50 days of growth and started to decline again. Less than 10,000 blocks left for halving! That’s about 67 days, and the expected halving date is estimated to be May 11, 2020. Will it help Bitcoin to get back on the horse?
Right from the start, we would like to point out that halving itself will not affect the price of Bitcoin until it takes place. Then the inflation rate will be halved, which will help.
At present, approximately 1,800 BTCs are released into circulation daily (current value ~ $ 16.2 million). These are the newly created Bitcoins, which the miners earned as a reward for keeping the network running. For each extracted block (about once every 10 minutes), they receive 12.5 BTC + all transaction fees that are in that block.
After halving, the amount of newly formed BTC is halved, ie 6.25 BTC. So the miners will mine and sell less. The price should therefore rise.
Halving in the past
In the past, however, Bitcoin grew before halving. This was mainly due to the expectations of people moving in the cryptocurrency world and the increased interest of the media. After all, bitcoin halving happens only once every four years!
This caused hype before the past halving, which resulted in the growth of coin itself. But beware! The cryptocurrency market is being manipulated and there are many speculators who follow the rule:
„Buy the rumor, sell the news.“
That is why, just before and after halving, the price tended to fall in the past, as you can see in the 2016 chart:
Is there a similar development to that of four years ago? Maybe, but we can’t count on it. The cryptocurrency market is treacherous and rarely behaves as expected.
Bitcoin is ready for the next bullrun
The fact that we are expecting a good growth is evidenced, for example, regulated BTC Futures on the CME. Open interest on this stock market reaches a new high almost every day. Institutions are also interested in Bitcoin!
Bitcoin capitalization is slowly but surely approaching the 2017 figures and is only a matter of time before we can overcome this ATH. Thanks to the coins that were mined in two years, Bitcoin does not have to cost $ 20,000 to set a new record in capitalization.
As February comes to end #Bitcoin dramatically plunges to under $9,000 per #BTC, having hit $10,000 earlier this year. With such a rapid decline in price and the upcoming #halving in May 2020 all eyes are on #cryptocurrency markets next move.— Crypto Research Report (@CryptoManagers) February 28, 2020
Read more: https://t.co/9LCt36rkIA pic.twitter.com/wIQbDC3bDx
We can only argue about whether we will see a hype similar to what we saw in 2017. But it is virtually impossible to predict this. The fact is, people who bought and lost cryptocurrencies in 2017 are now returning to catch another big bullrun.