Bitcoin ‘Halving’ in 2020 and the predicted rally that might follow

For StormGain CEO Alex Althausen, 2020 could be a milestone for bitcoin. It has something to do with the event called “halving” and its potential effect on BTC’s price.

“My advice is to keep an eye on the Bitcoin halving in 2020, which can dramatically change the cryptocurrency supply and demand equation,” Althausen told Entrepreneur. “I believe it will be remembered as a historical milestone for Bitcoin and the entire industry. It could be the turning point that takes Bitcoin from a niche, unstable asset to a mainstream form of payment.”

Bitcoin halving is the term used to describe the decrease in the number of bitcoins from cryptocurrency mining. When bitcoin was first introduced, the block reward was 50 BTC, according to Forbes. By the next halving, it was further reduced to 25 BTC. Currently, the block reward for mining is 12.5 BTC.

But what’s important to note is that halving seems to have an effect on bitcoin’s price. The first time it happened was back in November 2012 when BTC was trading at just $11. The following year, it started its climb eventually reaching $1,100 in 2013. The price crashed and was trading at the $220-$240 range for the next couple of years.

The second halving happened on July 9, 2016. In the months that followed, it was trading in the $580-700 range until it started to soar. Well, everyone still remembers that all-time high it established in December and the crash that followed.

Based on the two previous halvings, there appears to be a pattern of a rally followed by a correction. The biggest question is whether or not the same thing will happen in the next halving which is set to happen next year.

But whether the next halving will follow the same pattern or not, it’s only a matter of time before the token proves its critics wrong according to Dan Schatt. The Cred CEO and co-founder Dan Schatt then proceeded to give his arguments to support his position.

“Bitcoin has become more widely adopted for several reasons,” Schatt told Entrepreneur. “It has a predictable inflation rate because only 21 million will ever be produced. It is borderless, with transparency that no bank can match. And it is trustless because the system was designed so you don’t have to trust anyone else for it to function.”

Schatt also pointed out BTC’s resilience despite the negative predictions of its critics. “It has been declared dead by journalists 378 times, including 40 times this year,” he added. “But Bitcoin won’t die because it can be trusted more than most government currencies. There is no intermediary.”