It is believed that the upcoming bitcoin halving of 2020, which will halve the reward for mining a BTC block, can raise a coin to a new record maximum. One analyst expressed the opinion that she could fly up to $ 55,000.
After the boom of cryptocurrency in 2017 and the stagnation that lasted throughout 2018, experts and analysts put forward various assumptions that will be the catalyst for the next sustainable bull movement.
According to PlanB, a reduction in the BTC mining bonus, scheduled for May 2020, could lead to an increase in the bitcoin price to $ 55,000.
Currently, on average, blocks are mined every 10 minutes with a reward of 12.5 BTC. This means that 1,800 new bitcoins worth $ 9 million at $ 5,000 per coin are put into circulation every day.
Every four years, the remuneration is halved, the next should reduce the current 12.5 BTC to 6.25 BTC. This process is intentionally embedded in the biktoin protocol to control cryptocurrency inflation, creating an asset deficit.
The estimate used in the analyst's price forecast took into account the current or outstanding stock of various assets relative to the new offer (inflation). According to the report, in terms of the ratio of reserves to flow, Bitcoin is an “extremely scarce” asset.
It is claimed that currently SF Bitcoin is 25, which means that 25 years of production is required to achieve a current bitcoin stock of 17.5 million coins. Nevertheless, since the issue of Bitcoin is fixed at 21 million, only 3.5 million coins remain to be mined. Bitcoin SF is expected to reach 50 in 2022, which is close to gold.
This puts bitcoin in the cash category, along with silver and gold. Currently, gold has the highest SF at 62, while silver is second with SF 22.
The purpose of establishing these amounts is to indicate a linear relationship between the SF and the market valuation of the asset. In this regard, the analyst argues that a reduction of two times will inevitably lead to an increase in the SF ratio, with the result that by 2022 the market capitalization of Bitcoin will reach $ 1 trillion.
Such a high market capitalization suggests that one bitcoin will cost about $ 55,000, the report says. And although the projected price may seem high compared to its current value, according to the analyst, it will correspond to market trends.
The report notes that the funds needed for BTC's market capitalization of $ 1 trillion will come from various sources, including gold and silver, the capital of billionaires hedging their assets, as well as institutional investors planning to switch to an asset that was “ the best in the last 10 years. ”
Moreover, countries with authoritarian governments – Venezuela and Iran, as well as countries with negative interest rates, for example, Japan, will also invest part of the funds in Bitcoin.
Publication date 04/05/2019
Share this material on social networks and leave your opinion in the comments below.
