The Bitcoin halving is on everybody’s mind today, as it is a very special occasion in the cryptocurrency world. With the block reward being cut in half, some of the industry experts weighed in with their feeling about how this situation will evolve. The previous time the Bitcoin block reward halved, a price increase followed roughly one week after the facts.
Lots of Bitcoin Halving Excitement
A reduced Bitcoin block reward is no automatic guarantee for a future price increase, though. While it is true Bitcoin has a limited supply of 21 million coins, the price per coin can go up, down, or remain the same. If the previous Bitcoin halving is any indication for what could happen, a wild ride is looming on the horizon.
iPayYou CEO and Founder Gene Kavner explained the halving as follows:
“The price of this halving has, most likely, already been baked into the current price of bitcoin. The big question is, whether the halving will have a negative effect on the bitcoin miners who perform confirmations of transactions. In my opinion, the metric to watch for is the blockchain mining hash rate after the halving. If it decreases suddenly, it is quite possible that the bitcoin price will fall. If the hash rate continues its upward trend it would indicate no negative effect on the miners and bitcoin price is very likely to follow upwards.”
The Long-Term Outlook
One thing that is important to keep in mind is how Bitcoin should be seen as a long-term investment. Unfortunately, most of the traders and investors don’t always see it like that. Bitcoin still has a relatively small market cap compared to other tradeable assets. Whether or not the Bitcoin halving will have a long-term price effect, is hard to predict at this stage.
When asked if the halving has any impact on the Bitcoin network itself Kavner stated:
“Bitcoin miners will see the direct impact of the halving since the reward of mining is paid only to them. They get to keep the reward as consideration for the sizable electric bill they need to pay to run the mining equipment. If the halving of their revenue does not dissuade them from continuing their critical role in confirming bitcoin transactions, it will have no effect on those using bitcoin.”
For the time being, there seems to be little price action going on across the exchanges. CryptoCompare statistics indicate there is a lower trading volume in the USD market for the time being. China, on the other hand, continues to trade Bitcoin with high volume, as it always has. However, there is no sudden increase to be noted there either.
Source: News Tip Via Email
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