Yesterday we wrote that the price of bitcoin has been in a sideways channel for a while. There is a good chance that this will not change in the coming week. This is a good time to look at the bigger picture.
Bitcoin halving as a start for bullrun
One of the most important recurring events of bitcoin is the block halving. This event halves the amount of bitcoin that is made every 10 minutes. Halvings are built into the protocol and take place approximately every four years.
The halving makes the range of available bitcoin transparent, predictable and reliable. Important properties for what many call a store of value. Although the range is predictable, the price is not. Also not in the period around the halving. After completing two halves, Bitcoin is now approaching his third and will take place in May 2020.
Next year, the current block remuneration of 12.5 bitcoins will be halved to 6.25 bitcoins. From that moment on, the issue of new bitcoin is fixed in the coming four years.
What can we learn from previous halvings?
Traders and analysts, of course, want to make a difference here. Looking back on the previous two halves, there are similarities in price movements that can be extrapolated to the halving in 2020.
Analysts speculate over and over again how the halving will affect the price of bitcoin. One of the most optimistic predictions comes from Rekt Capital, this analyst thinks the bitcoin block halving is an important catalyst for the next bullrun. According to the analysis, there are different indicators and trends of the first two halves, which can also be applied to the upcoming halving.
If #Bitcoin rallies just like it did in its previous two Halvings…
Bitcoin’s price will be $ 385,000 – $ 425,000
A $ 385,000 $ BTC would mean that BTC’s Market Cap ($ 189 billion) will have eclipse the Market Cap of Gold ($ 7.8 trillion) https://t.co/4StGrayYMg#Crypto
– Rekt Capital (@rekcapital) September 10, 2019
At least $ 385,000
Rekt Capital sees the price of bitcoin rise to great heights. He expects the rate to be anywhere between 385,000 and 425,000 dollars. He substantiates this by first looking at the previous halvings:
- Halving is the start of bullrun
- Bitcoin exchange rate rises between 12,000 and 13,000 percent both times
Regarding point 2, at the second half it took twice as long before that percentage was achieved. This growth is largely achieved after the halving. After the first halving, growth was five times greater than before the first halving. The second halving involved 10.5 times.
Highlight only after halving
The analyst therefore does not expect that the all-time high of $ 20,000 for the halving is already exceeded, but does think that we will not get far from it. He also sees a fall in the course, just before the halving. According to Rekt, that is a perfect time to get back in.
Looking back can be useful, but it is not a guarantee that exactly the same patterns will repeat. He quotes Mark Twain:
History does not repeat itself, but it often rhymes
Read the full analysis here.
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