As a result of the upcoming Bitcoin halving in May 2020 searches on Google for Bitcoin and other exchanges have hit a record high. The incredible volume of search indicates that there is a peak interest in cryptocurrencies all around the world. All through the 11-year history of Bitcoin there has never been this volume of traffic. The Traffic on search engines is so enormous that it is on par with the coronavirus. This has also led to an increase in traffic and demand for other digital currencies.
Every four years Bitcoin goes through a process known as having and the previous halving were in 2012 and 2016 respectively. This would be the third halving event in the history of the cryptocurrency giants. Halving is a mechanism that is aimed at reducing the reward per block mined on Bitcoin’s blockchain by as much as 50%. This means halving would cut the pace of supply expansion by 50% in a periodic interval of 4 years. After the Halving event by May per block reward would reduce from 12.5 BTC to 6.25 BTC.
The crypto giant network issues New Bitcoins every 10 minutes and for the first 4 years of its existence, a total of 50 Bitcoins was issued in every 10 minutes. This number was cut in halve in 2012 in a process called halving. Therefore in 2012 the amount of Bitcoin issued every 10 minutes stood at 25. Halving in 2016 cut that figure to 12.5 BTC and now in 2020 halving would cut it from 12.5 BTC to 6.25 BTC. This is how Bitcoin cuts its supply.
The significance of Bitcoin Halving
Halving is aimed at cutting off the supply of new Bitcoins and in economics lower supply would result in a higher cost. This means halving would likely cause Bitcoin to surge in prices based on the principles of supply and demand. Historically Bitcoin Having has dramatically led to the rise in prices. Here is a stat to prove that
Halving in 2012
Price of Bitcoin on Halving Day = $12.35
Price of Bitcoin 150 days after Halving = $127.00
- Price of Bitcoin on Halving Day = $650.63
- Price of Bitcoin 150 Days after halving = $758.81
The surge in Traffic for Bitcoin and other exchanges
As a result of the halving coming up by May, there is a great rise in traffic. This surge in interest has greatly translated into actual purchases of Bitcoin and other exchanges. As at when this article was composed 1 BTC exchanges for $7,050 and this is at a time when the world economy is been ravaged by the coronavirus. At such one may associate the price stability with the search interest of Bitcoin halving. Other digital currencies are also experiencing a rise in demand
There are various models that explain the price implication of Bitcoin after the halving. Some experts are predicting that in the coming two months the price of Bitcoin would go as high as $100, 000. This is because halving would create an upward trajectory on the price of Bitcoin.
It is also important to know that the anticipated rise in the price of Bitcoin as a result of halving has meant fewer people are willing to sell their Bitcoin and the term “Buy Bitcoin” is down by as must as 35%. Rather there is an increase of people holding the address of 1 BTC or 0.1 BTC, this means people are accumulating their Bitcoins and here is a stat to prove that.
The number of unique addresses holding at least 1BTC is at a record high and it stands at 805,805 as at the time of writing this article. This is according to Glassnode which is a Blockchain intelligent firm.
The number of unique addresses holding 0.1 BTC is also at a record high of 2,984,777. This rise started late February in the early weeks when people began to search for Bitcoin halving.
There is clearly an increased retail interest in Bitcoin and its effects are positively rubbing off on other exchanges. However, halving is not the only reason for the increased traffic for exchanges / digital currencies. We are in an unprecedented era of money printing, money handling, and stimulus that has caused many people to turn to Bitcoin and other exchanges. In most parts of the world, people do not have access to money and most people are locked up at home. This has meant more and more people have turned to Bitcoin and other digital currencies as alternatives.
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