Looking Towards the Bitcoin Halving: Will BTC Price Pump in 2020?
The number of BTC awarded to miners for adding blocks to the Bitcoin is set to decrease next year. These so-called halving events occur about every four years and are part of the cryptocurrency’s distribution schedule.
The next halving, expected in May of 2020, will be Bitcoin’s third. The previous two halvings resulted in huge surges in BTC price in the months that followed them.
Will Bitcoin Rally Following the 2020 Halving?
Bitcoin was originally designed with a hard and fast supply distribution schedule. Every 210,000 blocks mined by the Bitcoin network, the number of Bitcoin awarded to miners for successfully adding a block to the blockchain decreases. In 2009, block rewards were 50 BTC. After four years, this decreased to 25, then to the current reward of 12.5 in 2016.
The number will reduce once again to 6.25 BTC next year. Previous having events have been followed by steep run ups in Bitcoin price. From a theoretical perspective, this makes sense. Equal or increased buying pressure with few new coins hitting the market will make the price rise.