Bitcoin Halving is Unlikely to Initiate Bull Run; Says Messari Research Group
Some market participants have been anticipating the next major Bitcoin bull run to be catalyzed by the imminent BTC mining rewards halving scheduled for May 2020. This is because of the historical precedent of these events.
Despite the anticipation, a blockchain and cryptocurrency research group known as Messari is now saying that the direct basic influence on the inflation of Bitcoin, produced by the halving will be insufficient to bring about any remarkable upsurge. However, they further noted that another reason exist for the event to bring about an uptrend.
Previously, mining rewards halving events always have close correlation with the beginning of parabolic price cycles that pushes BTC to new highest price of all time.
Market participants should note that only a few of these events have occurred in the comparably short history of BTC. Due to the little sample size, the possibility of predicting what would happen in the coming halvings is amazingly difficult.
In 2019, there will be a reduction in the inflation rate of BTC from 3.7 percent yearly to 1.8 percent, and may be insufficient to initiate any upsurge.
The research group mentioned this on Twitter recently. The tweet highlighted that despite the insufficiency of the inflation reduction to bring about an upsurge, it reminds the markets that the scarcity of the crypto may assist in bringing about a price rally.
“On 2020 $BTC halving: + Inflation will drop from 3.7% to 1.8%. 2% inflation reduction is not a big enough catalyst + However, market will be reminded of BTC scarcity. @GrayscaleInvest & @CashApp will be buying majority of new issuance by Q3 2020,” they noted.
On 2020 $BTC halving:
+ Inflation will drop from 3.7% to 1.8%. 2% inflation reduction is not a big enough catalyst
— Messari (@MessariCrypto) December 20, 2019
The price trends of BTC within the months that precede May 2020 will possibly offer insight into the anticipations of investors as regards the results of the halving.
Featured image courtesy of Shutterstock. Source: CryptoPress.