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Next Bitcoin halving may have bearish implication

Chayanika Deka

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Bitcoin’s halving in 2020 is just around the corner, and this has given rise to various narratives in terms of its price movement following the event. But halving might not have a dramatic impact on its price. Many industry influencers have speculated on the impact the halving could have: will it follow Litecoin’s path?

Former Senior Market Analyst at eToro Mati Greenspan in a recent conversation with AMBCrypto said,

“My feeling is that the upcoming halving event is not priced in at the moment. My best guess around the bearish action in the second half of 2019 is due to an ongoing war among crypto miners. There have been a round of new technology coming out in the last few months that makes the old mining rigs obsolete. Therefore, the miners that were stashing their Bitcoin in the bull run have now sold some off in order to upgrade their equipment.”

In another argument, CSO of CoinShares, Meltem Demirors said that “there is a very real possibility the price of Bitcoin does not go up after halving.” In a recent tweet, Demirors stated,

“for the first time, there is a robust derivatives [futures, options] market for bitcoin. most firms looking to speculate on bitcoin will trade a derivative, not the underlying.”

There has been significant growth in Bitcoin and the crypto derivatives market. And this could, in fact, change the trajectory and hinder the profitability factor for the miners. The exec of the digital asset management firm opined that when the derivative sector “take off”, the producers [miners] “lose the right to set prices”. The price of the Bitcoin would “decouple from its value, supply and demand”, the more it becomes an “investable asset”, Demirors cited.

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Chayanika is a full-time cryptocurrency journalist at AMBCrypto. A graduate in Political Science and Journalism, her writing is centered around regulation and policy-making regarding the cryptocurrency sector.

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