Bitcoin and its value based on the blockchain have been under fire since the massive drop it took back on the 12th of March when it plummeted losing half its price.
Just before this happened, people were touting BTC as the safe-haven during the global coronavirus scare. But instead, we saw a drop as stocks and commodities around the world crashed.
Stocks Still Struggling While BTC Returns
Bitcoin is doing better than gold so far in May. There has always been a correlation between BTC and traditional markets. The correlation to US equities is more than slight, it’s moderate at the least but hasn’t ever really had a notable connection with gold. Even so, it looks like BTC is starting to separate itself from the crowd as it not only outperformed the S&P 500 over the first quarter but is also doing better than commodities like gold.
Hahaahaha btc and gold— Xtrimp (@1x4r4p) May 11, 2020
Tell me pic.twitter.com/q7pGGnHQWW
New All-Time High on the Way
Back in early February, Yahoo! Finance’s Tom Lee predicted that bitcoin could reach $27K. 200 moving average indicators could set off a 197% return.
“That’s a big deal as you know, as anyone who’s a trend follower knows — when you’re back above your 200-day, you’re back in a bull market. Whenever Bitcoin breaks back into its 200-day, its average six-month gain is 197%.” – Lee, via Cointelegraph
Of course, this interview took place before the massive pandemic stockmarket and BTC crash. But BTC has already recovered back to 9500, so is the market headed towards a full bull run? Could Lee’s assessment come to fruition?
Most agree that halving will set bitcoin off on a massive bull run. Historically speaking, when BTC halves, the value increases. Some are predicting BTC to hit 100K by the end of 2021. But if you are worried about the hash rate immediately after BTC halves, you can use several sportsbooks to quickly turn your BTC into cash, then reconvert shortly after, fortunately, SBR provides a list where you can do it.
Let’s look at BTCs halving history.
It was originally stipulated that there would never be more than 21 million BTC. And minor’s block rewards have been cut in half at each halving. But what about prices?
- First Halving BTC Price $12 rising to $1,100 in one year. The
- Second Halving, BTC Price went from $650 to $2,500 10 months.
But with the rewards reduced to 6.25 BTC, some are speculating that the idea of halving will come into question. Will the transaction fees alone, be enough to support the market? In other words, will it be worth it for minors to handle BTC transactions? If not … well, that would be bad.
We should expect a hash rate drop. I both prior occasions we saw the hash rate significantly reduced immediately. But this time around it could be far more substantial. When market halves, the minors who have more overhead are likely to drop off the map. This means less hashing power across the board. That said, we shouldn’t worry too much. BTC is still the ‘safest’ decentralized network on the planet. Smaller minors might go belly-up and transactions may take a bit longer to verify, but the hashing power will stabilize and the market will be fine.
Whales Selloff, Halvening Approaching: #BTC on a wild rollercoaster– Great time to buy. For safety reasons, make sure your chair has a curved edge! ? pic.twitter.com/3AAaGwSoYj— MyBTC.ca ?? Bitcoin Brokers (@MyBTCca) May 10, 2020
Summer and Beyond
We could see BTC level off during the summer months. Typically, with equities, there is a summer lull. People leave their laptops behind for a bit of sun and fun. It’s not like they stop working altogether, but instead of working on through the entirety of the afternoon, when the weather is nice, people tend to stick to normal workdays. This is also affected by college students who trade. School is out so their laptops are closed more often.
That said, we should be well above the 10K mark again by the time summer is over and we enter the fall months. The future price, on the year, is set at 14,600. So, we could see it as high as 12,000 by fall.