There are exactly 250 days before the Bitcoin Halving event. After that, the BTC reward that miners receive for adding new blocks to the network will be slashed in half from the current 12.5 BTC down to 6.25 BTC. As this landmark event approaches, however, the Internet is speculating at large on whether or not this will cause a surge in Bitcoin’s price. If history is any indicator, however, it should.
Bitcoin Halving in 250 Days
In 250 days Bitcoin will go through its third halving and the supply of freshly minted BTC on the market will be reduced in half. Interestingly enough, Cryptopotato explained in depth what the event is and what it means for the network exactly 250 days ago.
To sum it up, the rewards that miners are currently receiving for adding blocks to Bitcoin’s network is will be slashed in half. They are currently receiving 12.5 BTC and this will go down to 6.25 BTC.
This means that the supply of Bitcoin will be reduced in half. Now, basic economic principles dictate that if the demand for an asset increases or stays the same as its supply gets reduced, its price should go up.
Historically, that’s what happened to Bitcoin’s price following its two previous halving events. BTC increased by a factor of 10x in less than a year after the first halving back in 2012 and by more than 400% in the year following the second halving in 2016.
Not surprisingly, people are now wondering if the same would happen in 2020 as the next Bitcoin halving is scheduled to take place in May.
Is History An Indicator?
Another interesting thing to consider, however, is if the halving was already priced in during Bitcoin’s surge in 2019. Of course, it’s rather impossible to know that for sure, but popular trader Moon Overlord made a correct prediction based on historic facts back in April.
He outlined that the cryptocurrency starts pumping around 1 year on average prior to its halving date.
#Bitcoin has traditionally starting pumping around 1 year on average before it’s halving date
The next halving is estimated to be May 2020, meaning that the uptrend will begin in May of this year
— Moon Overlord (@MoonOverlord) January 23, 2019
And we can see that Bitcoin really did rally hard in May. The price went from around $5,200 at the beginning of the month to about $8,200 at its end, marking an increase of more than 57%.
So it appears that, so far, history has indeed been an indicator for the price, especially when it comes to the halving events. It remains interesting to see whether or not we’ll see the same pattern happen again following or before the 2020 halving.
The post 250 Days To Bitcoin Halving: History Indicates Massive Surge Afterwards appeared first on CryptoPotato.
Source: Crypto Potato