Bitcoin saw massive growth after the 2016 halving.
On May 20th 2020, the third Bitcoin halving will occur. 50% less Bitcoins will be generated every 10 minutes and this could change the value of Bitcoin. Forever.
This is known as a “Halving” and it has already occurred twice, each time boosting Bitcoins price by at least 10x. Despite increased awareness around Bitcoin, not a lot of people seem to be talking about this.
Today I will explain the bitcoin Halving, how it could affect Bitcoins price and what to expect.
A deflationary currency:
Bitcoin operates on a model of deflation. This means less Bitcoins will be made over time and eventually the supply will stop.
The supply will end when the last Bitcoin is mined in the year 2140. Bitcoins supply is limited to 21 million units by it’s built in algorithm, no more than that amount can ever exist.
This is different to fiat currencies which use an inflationary model. Inflation is a model where central banks can print extra units of currency at will. Bitcoins deflation makes it scarce and as we know, when something is scarce, it has more value.
HOW THE HALVING WILL AFFECT BITCOINS PRICE
After the halving, miners who don’t find it profitable to mine anymore will give up. Most miners will continue to mine and will only sell their bitcoins at a profitable rate, thus increasing Bitcoins asking price
If we look at previous halvings, we can see how Bitcoin’s price was affected.
THE FIRST HALVING
The first halving occurred on November 28th 2012 when one BTC was worth around $11. A year later,bitcoins price surged to a mouth watering $1,100 in 2013, a price never before seen with Bitcoin. it had only been one year since the halving and bitcoin had grown 100x
THE SECOND HALVING
The second halving took place in july 2016. Bitcoin maintained a price of around $600 - $700 before flying to $20,000 in the great bullrun of 2017.
Bitcoin had grown over 33x from it’s price before the second halving and over 1,818x from its price before the first halving.
THE THIRD HALVING AND WHAT TO EXPECT
With the next halving only around 10 months away, what can we expect to happen to bitcoins price?
I believe that it will follow previous trends by reaching a new all time high a year after. Bitcoin could likely hit a 10x from it’s price before the halving, so $100k looks possible to me.
“when i hear people talking about a bitcoin “correction” I’m thinking $100k, maybe $1m. That’s what’s correct.”
Are you serious? Haven't you noticed it's already May 24th? Do you even read what you write?