The long-awaited miner reward block halving of the Bitcoin blockchain is currently underway, with BTC prices that seem to be all over the place.
To put this in narrative form, Bitcoin started building over a week ago, and steadily increased to highs near $10,000 before crashing over the last 48 hour cycle with some amount of price consolidation in the $8500 range.
For reference, one-month lows are under $7000, and three-month lows are under $5500.
Over the past year, BTC started out at $7000 and spiked to over $12,000 before declining in fits and starts to a low mark back near $7000. The $7000 mirrors some of the sideways crawling that the coin did in 2018 where it hovered near $6500 for months.
Now, at Coingape, John Isige writes that Bitcoin is like a “loaded gun pointing to $10,000” and suggests that the gains from reward halving are going to be delayed a bit.
“Many people in the industry expected a rally in the price during the halving process, however, history suggests that the impact of halving is usually gradual,” Isige writes. “Therefore, investors can expect a stronger bullish momentum towards the end of the Q2 and a significant breakout towards the end of 2020 and in the course of 2021.”
However, analysts are also still warning traders that despite the history of BTC halvings raising price, today’s environment is different.
“The crypto market has notably matured compared to 2012 and 2016,” writes Oluwaseun Adeyanju at Forbes, suggesting that BTC is only currently a buy for hodlers. “For one, Bitcoin derivatives including futures and options are relatively more predominant these days, allowing for a more advanced price discovery among market participants. By implication, the narrative of a rally driven by the supply-squeeze might not play out so simply, at least not in the short term.”
Factor all of this into your crypto strategy.
