Bitcoin has garnered much of the attention of the global media after rising from lower $4,000s to over $10,000 in the last few months. The price is consolidating largely around the mark of $10,000 and at the time of writing, bitcoin is priced at $9,543.
Talking about the future movement of the asset from here on in terms of a bull or a bear run, the Chief Executive Officer of the content-creation platform Rokfin, Martin Floreani recently stated to BlockPublisher:
Bitcoin is primed for a big move. Everyone sees the halving in 2020 on the horizon and is trying to decide if it’s priced in or not. In the end, I think FOMO will win out and we’ll be in a bull-run
The early hopes that were being developed around bitcoin price crossing an all-time high are now slowly diminishing. One of the major reasons that are expected to guarantee the next bull-run of bitcoin is halvening event. Halvening is going to reduce the supply of bitcoin in circulation and the event is expected to take the price of bitcoin up, based on the simple supply-and-demand principle.
With the aspect of bitcoin supply getting less in the market next year, investors are expected to flock into the bitcoin world and buy the asset before its price goes out of hand. This is exactly what creates the “fear of missing out”, or more commonly known as the FOMO.
Some are suggesting bitcoin will likely see a bearish trend for the rest of 2019. The struggle for bitcoin to go on a bull-run has resumed again as the asset has been showing no substantial growth over the past few weeks.
Bitcoin is based on the proof-of-work (PoW) framework which requires miners maintaining the network to solve a specific cryptographic puzzle to earn the reward and mine a block. The reward is given to miners for contributing computational power to the network and it is in the form of newly minted bitcoins.
The current bitcoin reward amount is fixed at 12.5 BTCs and the overall number of bitcoins that will ever exist in the network is algorithmically capped at 21 million, while the current supply is around 17,845,300. Now in order to account for inflation, the reward given to miners is algorithmically halved after an average of almost 4 years. This reduces the supply and thus makes sure new bitcoin come into circulation at a specific rate, eliminating inflation. The next round of halvening in the bitcoin network is now expected in May 2020.
FOMO drags more people into the bitcoin world every time its price starts to show a bullish behavior. Bitcoin’s bull-run of 2017 resulted in a lot of millionaires, mostly people who bought the asset at the right price and sold it while it was still soaring high. The asset rose from a few thousand to almost $20,000 fairly quickly at the end of 2017.
If an opportunity like this ever happens again, FOMO will again drag new investors in to buy bitcoins. Increased demand is thus expected to increase the price as well. At the core of this FOMO pointed out by Martin, halvening is expected to play its part moving forward.
As opposed to 2017, the bitcoin space has also progressed a lot till now. The overall acceptance rate of cryptos and blockchain technology is on a gradual rise. Global giants such as Facebook are showing their interest in the new prospects that the crypto world brings. Facebook has even announced its very own cryptocurrency Libra. Blockchain technology is being incorporated by many big conglomerates into their own workflows to improve factors such as transparency, efficiency, etc.
The crypto space is getting healthier with lawmakers stepping into it to understand the decentralized framework so that better crypto regulations can be put in place. Things have been aligning almost perfectly for a likely bitcoin bull-run. But given the track record of uncertainty in the bitcoin world, nothing can be said for sure as of yet. Although if the halvening FOMO has not been factored into bitcoin price yet, a likely upward tick is expected to come prior to May 2020.