About every four years, the amount of Bitcoin created in the mining of a block gets cut in half. This is referred to as a ‘Halving.’ Until now, there have been two such occasions, with the upcoming third estimated to occur around May 17, 2020. Since Bitcoin becomes scarcer after halving, its price has historically increased after to make up for the demand.
Well-known trader and financial analyst @Rektcapital recently pointed out interesting price movements before and after the two previous halvings.
The dates for the first two halvings and the projected date for the third are given in the table below.Bitcoin tends to retrace prior to its Halvings
— Rekt Capital (@rektcapital) October 1, 2019
Previously, $BTC saw a -38% retrace prior to Halving 2
And a -50% retrace prior to Halving 1
Is this current ~40% downside in BTC's price the retrace prior to Halving 3?https://t.co/4StGraQAaQ#Bitcoin #Crypto
Date | |
First Halving | November 26, 2012 |
Second Halving | June 11, 2016 |
Third Halving | May 17, 2020 |
- The price reached a bottom before halving and began an upward move.
- The rate of increase is moderate prior to halving
- The rate of increase is rapid after halving.
The First Halving
The first halving occurred on Nov 26, 2012. Prior to, Bitcoin’s price dropped by 93.73%, reaching a low of $2.01 on November 18, 2011. An upward move ensued, lasting 508 days and culminated with a high of $268.67 on April 10, 2013. This amounts to an increase of 13,294%.
Second Halving
The second halving occurred on June 11, 2016. Prior to this, BTC decreased by 86.22%, reaching a low of $163.88 on Jan 14, 2015. An upward move ensued, lasting 1068 days and culminating with a high of $19,764 on Dec 17, 2017. This amounted to a total increase of 12,161%.
Third Halving
The third halving is projected to occur on May 17, 2020. The price decreased by 84.1% and reached a low of $3148.33 on Dec 15, 2018. Assuming an increase of 12,500% (Average of the increases of halvings 1 and 2), we get a price of nearly $400,000 as a new target high after the halving.
Images are courtesy of Twitter, TradingView.
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