Attention is focusing on whether the 2020 Halving affect bitcoin price, which is approaching next May, will reverse the price of bitcoin. Many cited Halving as a factor leading to price hikes in that it increases the scarcity of cryptocurrency.
However, not a few people are skeptical. As bitcoin price did not actually fluctuate much in the previous two Halving months.
Previously, bitcoin Halving took place twice on Nov. 28, 2012 and July 9, 2016. Mining compensation, which was the first of its kind 50, fell to 25 in 2012 and to 12.5 in 2016.
A Coindesk article analyzed that the $12,000, which was the highest Bitcoin price this year, already reflects the Halving increase. Bitcoin prices had fallen to the $3,000 level earlier this year before jumping to the $12,000 level in June.
Not only halving, many affect bitoin price
It then analyzed that external factors in the cryptocurrency market have also changed compared to the previous Halving. When Halving of bitcoin occurred for the first time in 2012, it was an extremely early market where there was no inflow of institutional investors or release of cryptocurrency derivatives. Based on these factors, it is encouraging that Halving will not immediately raise the price of bitcoin, the report said.
Joseph Young, a market analyst, also predicted in a contribution to Forbes that Halving will not have a significant impact on the market.
“When a bitcoin Halving occurs, large mining companies have to make up for their profits through other means, including cash, because their profits are halved,” he said. “This is likely to cause large mining companies to leave the market, and although new players have to enter the market, these movements have decreased recently.”
He added that the price of Bitcoin has faced two Halving cycles so far, and it took about a year for the price to reach its peak in both 2012 and 2016.
In fact, the price of bitcoin, which stayed in the 12-dollar range during the Halving in 2012, hit 1,147 in 2013. Afterwards, the economy remained flat at around $480 before the Halving in 2016. And rose to $19,000 only in 2017, about a year later.
Industries pointed out that there is a high volatility in the cryptocurrency market. So we need to wait and see the future situation of the market.
“The market is already being driven by investors with large amounts of bitcoin.” said an industry source.
Bitcoin has been experiencing drastic ups and downs within this year.
