Bitcoin halving event: ‘going to see higher prices’
12 May 2020
Bitcoin underwent a highly anticipated ‘supply squeeze’, known as a ‘halving’ on Monday evening – only the third ever in its 11-year history.
It means the rate at which new Bitcoins are created has been slashed in half forever. The reward for unlocking a ‘block’ has been cut from 12.5 new coins to 6.25.
Only 21 million Bitcoins will ever be generated by the network, leading many experts to feel confident that a bull run of the world’s biggest cryptocurrency is about to commence.
As the halving took place on Monday, deVere CEO and founder Nigel Green said: “Previous Bitcoin halving events have prompted impressive price climbs. The 2016 halving triggered a 300% jump in the value of Bitcoin.
“There is no reason to believe this time the market will not respond with a longer-term upward trajectory after an initially muted response, as always happens.
“Indeed, the rally which is likely on its way could potentially be even more dramatic because there is more mass awareness than ever before of the long-term use of and need for digital currencies.”
In a similar vein in an interview with Reuters, Edward Moya, senior market analyst at OANDA noted: “[L]onger term, you’re probably going to see higher prices. With all the fiscal and monetary stimulus that’s being pumped into the global economy, there’s renewed interest from institutional traders looking for alternatives to modern government-backed currencies.”
Before the halving, the Bitcoin price had more than trebled in the last three months.
Speaking at CoinDesk’s Consensus: Distributed virtual conference, Cynthia Wu of Matrixport, said, “Halving was already priced in and the cryptocurrency could trade in the range of $8,000 to $10,000 in the near term.” Thus far, this has been the case.
The next Bitcoin halving event takes place in 2024.