Bitcoin goes through an even known as halving every time 210,000 blocks are mined. As a result, the mining rewards are cut in half. This event occurs roughly every four years. Therefore, there have been two halvings hitherto, with the third one expected to occur on May 2020.
Since we believe that in May 2020 the Bitcoin price will be between $7000-$8000, the increase from the previous to the current halving will be much smaller in relation to prior halvings, amounting to a total of 1000%. This makes sense since the logarithmic growth curve shows that the rate of increase decreases as time goes by.
Twitter account @chartsbtc showed the price and dates for the two prior halvings. They were:
- 11 November 2012 – $12
- 7 September 2016 – $658 –
- May 2020-?
Bitcoin Halving Candles pic.twitter.com/ejB6lgynNj
— Bitcoin Charts (@ChartsBtc) October 18, 2019
From Bitcoin’s inception, the increase to the first halving has been 11000%, that from the price of the first to the second has been 5500%, while the third one is yet to be determined.
Let’s discuss these below.
Rates of Increase
The rates of increase of the price from one halving to the next along with the dates of the halving are given below:
As we can see, the rate of increase has been smaller each consecutive halving (The rate of increase for the third halving is based on the projected price).
Using curved trendlines we can limit the scope of Bitcoins price movement since its inception.
Additionally, we can see that the period prior to halving has been characterized by consolidation close to the support line.
We think that the price is likely to act in a similar manner prior to the third halving.So, we believe that the Bitcoin price will be between the $7000-8000 range at the time of the third halving, this makes the price increase between the 2nd and 3rd halvings the smallest to date.
Do you think Bitcoin will consolidate before halving? Afterward, will it accelerate its rate of increase? Let us know in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Images courtesy of Twitter, TradingView.
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