Bitcoin Halving 2020: Everything You Need to Know
The Bitcoin Halving event in 2020 is an extremely significant part of Bitcoin’s history, but it will also help to shape the future value of the virtual cryptocurrency as well. Every time a halving event takes place, the reward for virtually mining a Bitcoin is halved. This means that the same amount of work will actually be rewarded with less Bitcoin. This means that if demand stays the same and supply is now cut in half, that the price of the asset should technically go up.
There are other external factors that play a role in the value as well, including the primary stock indices and the acceptance of Bitcoin as a global cryptocurrency. The price of Bitcoin is the same on every continent (it doesn’t matter if you buy Bitcoin in Australia, USA, Germany, or Brazil), but things can get tough when attempting to convert Bitcoin into several different foreign currencies.
Bitcoin’s Future Price
The halving event has a significant influence on the future price of Bitcoin, because Bitcoin collectors will immediately have a significantly tougher time of unlocking Bitcoin rewards through virtual mining. While it may get tougher to mine new Bitcoin, the fact of the matter is that all previously owned Bitcoin will likely go up in price on the speculative markets because less will be available in the future. Bitcoin’s halving events are also designed to cut inflation in half to prevent other possible issues in supply and demand.
Future Bitcoin Halving Events
Bitcoin is designed to create a halving approximately every four years through the middle of the next century, long after many of us will be here. It is unclear if Bitcoin will still be relevant in the mid-2100’s, but it certainly is a possibility. The process for mining completely changes at that point, but at least for right now, there is no sense in discussing that subject. The most important thing to discuss is the next Bitcoin halving, which happens to take place in 2024.
There is a very real possibility that Bitcoin’s price will drive upwards now that the 2020 halving is completed. As we slowly inch closer to the next halving in 2024, there will surely be even more reasons to believe that Bitcoin’s price will skyrocket.
Here is another interesting fact about Bitcoin’s halving that take place every four years. The Bitcoin price has never entered a halving event lower in value than a previous halving event. That’s a remarkable fact and it could signal the same possibility going forwards, but there are no guarantees.
List of Previous Halving Events
- Halving #1 – November 2012
- Halving #2 – July 2016
- Halving #3 – May 2020
Speculative Pricing of Bitcoin
The speculative market prices of Bitcoin tend to vary significantly after a major Bitcoin halving event. We have seen bull markets immediately after Bitcoin halving events in the past, but they are typically followed by a less-severe bear market afterwards. In any case, the Bitcoin markets have never plunged below their previous halving price, as we previously mentioned.
The future of Bitcoin price speculation will be driven by a number of factors. Investors are starting to evaluate charts from previous halving events with the intent to discover future price targets for Bitcoin. The long-term trend for Bitcoin is certainly upwards, but that trend can change at any time and there is no exact way to predict when that will happen.
The good news for Bitcoin collectors is that the laws of mathematics and economics are favorable towards the price of Bitcoin as long as the demand stays the same. If Bitcoin continues to spread and becomes a major part of the digital financial system in the next several decades, it is quite possible that Bitcoin could find itself at six-figure price point by the end of the century. If that is indeed the case, it will take several halving events to reduce the supply enough to get to that point, but as every four years comes and goes, we certainly march closer and closer to that possibility.