Precisely on April 2, bitcoin began an escalation that led to a 34% appreciation until April 24. Analysts point to several reasons for the growth, including the bitcoin halving, slated to occur on May 23, 2020.
The halving event is the reduction of 50% of the reward paid to the network’s miners, who are the agents – owners of the machines – who monitor and validate the transaction. The Speculation seems well founded. The last halving was in 2016 and preceded a strong high as well as post event, with the BTC hitting its historic maximum the following year.
Monetary inflation
After next year’s event, BTC’s issue rate for the first time in history will bear a strong resemblance to that of gold. On a daily basis, of 1,800 Bitcoins generated, 900 new Bitcoins will be obtained due to the reduction of the reward, providing a monetary inflation of 1.8%.
And why do prices rise? A combination of BTC shortages and increased demand for institutional investors may raise the price of crypto-currency.
Market opinion
But is halving already (positively) affecting the market?
For CryptoInsights, a Twitter account intended for market analysis, it does not make sense that halving is affecting the price of the BTC. The argument is that halving has little relevance now, since 84% of the bitcoin supply is already in circulation. Explaining: a total of 21 million bitcoin units will be issued and 17.6 million units have already been issued by the close of this report.
However, after the next halving, annual bitcoin inflation will be less than the average of the fiduciary currencies in the world. This would therefore be an incentive for more investors to exchange fiduciary coins for crypto-coins.
Principal driver
Para o analista Chris King, do Morgan Creek Digital, o terceiro halving do bitcoin é um dos principais drivers do preço da criptomoeda no curto prazo.
Greater adoption
According to Marcel Burger, from the Burger Crypto Consultancy, with the gradual adoption of cryptocurrency and a lower natural sale at each halving, the trend is that the price of the cryptocurrency grows.
Last chance
For Jonathan Habicht, crypto consultant, if the BTC falls in price again in the short term will be the last chance to buy the cheap asset in this cycle. He also mentions the one-year approach prior to bitcoin’s halving.
Thomas Heller, Global Business Director of the F2Pool mining pool, believes that the price of the cryptocurrency will rise steadily in the coming months because of the halving event.
Faced with so many predictions, it is plausible that the price of bitcoin in the short term is being influenced by halving. We do not know, in fact, if the forecasts will materialize, but there are good indications in the scenario.
