Bitcoin halving: the analysts’ view on where the BTC price is heading

As bitcoin approaches its next halving, due in May, we look at two competing views on where the crypto currency could be headed.

What is the bitcoin halving and when will it happen?

The next bitcoin halving is due to take place in the week commencing 11 May, 2020. Bitcoin will halve the reward for mining new blocks, meaning miners receive 50% fewer BTC for verifying transactions. Bitcoin halvings happen once every 210,000 blocks – roughly every four years.

You can learn more in our complete guide to the bitcoin halving

What do analysts expect from the halving?

If the correlation between bitcoin and the general markets continues, Goldman Sachs says that bitcoin is in for a rough ride. It's basing this on the premise that the two work in tandem and that the S&P 500 is showing signs of stress.

Strategists at Goldman Sachs found that the five largest companies now account for a whopping 20% of the S&P 500's entire capitalisation, indicating a narrowing of market breadth down to levels that it says indicate a big stock sell off. To what degree the sell-off comes is up for debate. This is just one assessment and it's relying on a correlation between Bitcoin and the equity markets.

On the flipside there's the argument that bitcoin may be on its way up. Why? For this, let’s take a look at the bitcoin chart. It’s just broken resistance, which gives it a little fresher air to breathe. At 7710 you can see we’re at the highest we’ve seen since 13 March.

Bitcoin is about to undergo a halving, which is in effect a supply rate cut in a couple of weeks. It comes at about the same time when the Federal Reserve would be oversupplying their banking system with trillions of US dollars. This could put a bit of a spark under the crypto market as the scarcity of BTC alone could prompt investors to increasingly move their newfound capital into the bitcoin market.

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