With the third Bitcoin halving round the corner, the crypto community is abuzz with mixed range of anticipations and speculations. One of the concerns is surely about halving of the rewards as the coming halving event will reduce block reward from 12.5 to 6.25. Then, of course, we can’t deny the apprehensions regarding the COVID-19 pandemic which possibly led to a massive drop in BTC price (around $3,600) in March.
On the other hand, April brought good news and by May 8, BTC was hovering around a whopping $10,000. But, unfortunately, the coin faced a sharp decline the very next day, reaching to $8,100 by May 9. However, as always, many of us are confident about the future of BTC and we are positive the coin is all set to rally post halving.
Honestly, it was disappointing to find BTC dropping straight to $8,100 from $10,000 in just a day. But, as of now, it has managed to rise up wee bit to $8,800, and counting on my experience, I am hopeful to see a further rise in the coming hours.
“At present, BTC is having a hard time to beat two high end VPVR nodes right from $8,739 to $8,952. But, as we have just seen, the coin has already started to recover. In that light, I am expecting the coin to successfully push through these aforementioned VPVR nodes and if it is able to do that, we can expect a solid $9,300 mark very shortly.”
The history of Bitcoin halving shows a stellar rise in the coin price post halving both in 2012 and 2016. After the first halving in 2012, the BTC price soared by 6, 940 percent and swung from 10 USD to 704 USD over the next 4 years. With the second halving in 2016, Bitcoin reached its ATH in 2017. The coin price has increased by 10-fold since then as we approach to 2020 halving. In all likelihood, we are expecting a similar trend following the third halving as well.
Some miners are definitely worried over halving of rewards post third Bitcoin halving. But, we are expecting a 2-3x increase in BTC price after the third halving which only speaks of profit for the BTC traders and investors.
A major reason behind rise in BTC price after halving is the basic rule of economics- increased demand and reduced supply. BTC houses a finite supply and with each halving, there is a plunge in supply. But, numbers of traders and investors joining the BTC market are only increasing with each passing day which is amping up demand for the coin- and eventually will pique the price. In fact, BTC is poised to outshine gold in value very soon as the coin is slower to mine than even gold. Moreover, gold mining doesn’t follow reward halving after every 4 years.
Financial markets have suffered a major fall in the wake of the COVID-19 pandemic and the crisis has affected the crypto market too. But, fortunately, BTC has shown far better recovery graph compared to SSE Index, S&P 500, Nikkei as well as gold. No wonder, investors are counting more on Bitcoin today than traditional investment vehicles. As per the recent reports from Google Trends, Bitcoin halving is one of the most searched topics of late. Increased interest in the coin will eventually lead to a noticeable spike in the coin value.
With fiat weakening under the claws of COVID-19 pandemic, a large number of elite financial institutions are proactively investing in crypto industry, especially in BTC. The leading Grayscale Bitcoin Trust has received nearly 90 percent investment from the institutional investors in the last few months. BTC’s sudden swing to the $10,000 mark recently was largely due to open backing from Wall Street giant Paul Tudor Jones.
Final words
Good news is current BTC miners are comparatively in a favourably stance than the other two halving sessions. Credit goes to major factors like rise of mining-specific service businesses, professional custody frameworks, rise of liquidity across the crypto space and the OTC markets. Given the presence of all these positive conditions, we are expecting a notable rally for the BTC price in long term post the third halving.
Sydney has 20+ years commercial experience and has spent the last 10 years working in the online marketing arena and was the CMO for a large FX brokerage.
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