Up, Down, and Up Again: Can the Halvening Help Bitcoin (BTC) Hold $10k?
With the Bitcoin halvening event on the horizon, price predictions are flying around the room like over-zealous promises of free money on the 2020 election trail. Bitcoin’s recent attempts to tread water above $10,000 have helped to ramp up these predictions – but as we get within three months of the halvening event, what can history teach us?
The reality is that there doesn’t seem to be much of a pattern leading up to previous halvening events – at least not one that can tell us anything about this halvening. In the months prior to Bitcoin’s first halvening, we saw a period of relatively steady growth followed by a huge rally soon after the halvening. In Bitcoin’s second halvening, Bitcoin moved sideways for months before enjoying a minor rally just before the halvening event and then dipping again before enjoying a similar, albeit slower, rally to the first halvening.
One thing that almost everybody agrees on though, is that if history repeats itself, there will definitely be an impressive rally AFTER the halvening. However, the current cryptocurrency climate is vastly different today than it was four years ago. Tighter regulations, institutional investment, stablecoins, struggling tech stock, even the Coronavirus – all these things can make a difference. And keep in mind, even if it does rally it may not happen quickly – or even this year. After the second halvening, it took almost a year before the rally started in earnest.
Not on my watch!
Some rather negative people don’t think there will be a rally at all, with the term “priced in” being thrown around a lot. This means that investors have already planned and made safeguards for the upcoming changes, the result being that any unexpected activity will be significantly subdued. In fact, the current rally that Bitcoin is enjoying is most likely due to FOMO buyers wanting to get in before the “big event”, only to find that the big event will most likely be a damp squib. But, as with most cryptocurrency events, the hype will likely drive up the price more than the event itself – so, in the end, it all works out the same.
Bitcoin is old news though and right now it’s the least interesting asset on the market. Over the past week, little known coin Hadera Hashgraph has doubled in price following a Google partnership and Ethereum (ETH) has exploded, gaining 30% in value and rocketing up in price from $200 to $263! And it’s not the only one – EOS is up 20% in the past seven days, Binance Coin (BNB) up 32% and Tezos (XTZ) a huge 61%. If this madness continues, people are going to forget all about the halvening and start believing that “alt season” is actually a real thing.