Bitcoin is set to undergo a major halving in the next few weeks, and this has sparked several questions amongst both analysts and everyday traders alike.
The Halving Could Do a Lot for BTC
One of the big questions regarding bitcoin’s future after the halving revolves around whether it will be possible to perform a 51 percent attack on the world’s number one cryptocurrency by market cap. While bitcoin is the largest and most powerful digital currency and likely won’t fall victim to such a scheme, many can’t help but wonder about its future vulnerabilities.
Recently, both bitcoin cash (BCH) and bitcoin SV (BSV) – offshoots of the cryptocurrency that came about in 2017 and 2018 respectively – underwent halvings that brought about similar questions. Arcane Research analyst Vetle Lunde explained in a blog post earlier this month:
Going forward, it will be interesting to see if someone tries to perform a 51 percent attack on either bitcoin cash or bitcoin SV, and if so, how the two projects cope… Amidst the rapid reduction in hash rate of the bitcoin forks, bitcoin itself has seen an increase in hash rate.
The mining rewards for both entities were cut in half for those looking to extract new coins, and the same thing is set to occur for bitcoin in mid-May. Bitcoin mining rewards will fall from 12.5 BTC to about 6.25 BTC, hence the world “halving.”
But a 51 percent attack on bitcoin isn’t the only concern. Many find themselves wondering what could occur with the currency’s overall price. Will it potentially go up or will it go down? In the past, halvings have proven to unveil bullish momentum for whatever currencies are at the center of halving events, but with so many crazy circumstances surrounding bitcoin and its altcoin cousins as of late, it’s hard to know for sure what will happen.
Danny Scott – the chief executive of Coin Corner in the United Kingdom – explained in an interview:
History tell[s] us that the bitcoin price will typically begin to rise significantly within the 12 months following a halving, something that can be simply put down to supply and demand. Our data shows an increase in the number of new customers every month since the beginning of 2020. February was up five percent compared to January and March was up 17.6 percent compared to February. We expect to see this trend continue, not just for the next month, but for the next year.
We May Get a Lot More Out of It
Many seem to agree with Scott that the currency will spike in value in May and beyond, but others are expecting to get a lot more out of the event other than just increases to BTC’s price. One anonymous bitcoin analyst wrote on Twitter:
I hope this halving will teach us more about underlying fundamentals and network effects.