In May 2020, Bitcoin when through the third halvening since it was created. The halvening happens with cryptocurrency when the creation of new coins is cut in half. This also means that the rewards the miners receive after a halvening will be half what they were before the halvening. When Bitcoin was created, the issuance of Bitcoin was at 50 coins per 10 minutes. After the first halvening, it dropped to 25, and then 12.5 after the second halvening. It is now at 6.25 coins per 10 minutes.
What Happened Last Time?
At the time of the last halvening, the demand for Bitcoins rose. In fact, it went all the way up to $20,000 per coin. There was a drop in the value of Bitcoin shortly thereafter, which caused many to claim that Bitcoin was dead.
However, that wasn’t the case. It recovered and is still going strong. Although it has not yet reached the same high point that it reached in the past, it has the potential. We are seeing parallels to what happened after the last halvening now and many believe that the value of Bitcoin will see some increases soon.
What’s Happening Now?
In early May, the price for a Bitcoin was $10,000. This dropped to $8,700 after the halvening, but many experts are saying they feel that the price is going to keep going up. Some feel it will be close to or even higher than the $20,000 price that was an all-time high. Why do the experts believe this is going to happen?
It’s the state of the world today. The paper currencies that are backed by the government are not as trusted today because the governments are printing more and more money to help make their ends meet. Many see these measures as extreme, and they have lost faith in those currencies.
With Bitcoin, investors are seeing what they perceive as a safer investment. In light of Covid-19, as well as unrest in the United States, cryptocurrencies seem like a much safer bet. They believe that the price is going to skyrocket because of this. There are even some who believe that the price could reach as high as $100,000 over the course of the next several years.
When you look at what happened in the past, when there wasn’t so much turmoil in the world, you still saw increases in the value of Bitcoin. With the problems facing the world now, it is almost a given that the value will go up. This is especially true if these problems continue.
Are Digital Currencies Considered Stable?
While many are looking toward cryptocurrencies for their future, it doesn’t mean that they are stable. In fact, they are volatile. This means that the price of the coins can go up and down similar to what you might see with other types of investments. There is never a guarantee of what will happen with them. Some experts feel that this volatility might cause some people to be hesitant to move into cryptocurrency in the coming months. They feel that people will end up being more cautious and that it could take several months before the price starts to increase. Those who are looking for safer bets might be waiting until the impact of the halvening to settle before they make their investment.
However, you have to remember that many different types of investments are not stable. Investing in the stock market can be just as risky because of its volatility. Therefore, Bitcoin could make a good and safe investment to add to your portfolio. Those who may not have enough to invest in a single Bitcoin of their own right now could always consider mining Bitcoin instead.
Could It Be a Good Idea to Invest or Mine Now?
For investors, it might be a good idea to consider investing if you have the means, simply because the price of the Bitcoins is lower now than it will be in the future. After all, investors want to buy when the price is low and then hold onto the investment as it goes up in value. Many people are considering buying Bitcoin now, and you might want to be a part of that group.
When it comes to mining Bitcoin, it could be a good time to get started if you haven’t already. However, there are a few things you will want to remember. The machines that you are using should be the latest state-of-the-art miners to ensure that you have the power needed to mine. In addition, remember that it’s more difficult to mine now, and the profits might not be as high as they have been in the past. It’s still possible, but you need to do it the right way.