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Bitcoin is said to explode this year, the first time after such a massive blow-up in 2017. From nearly $1000 to approximately $20000, 2017 was definitely a blessing for the Bitcoin investors. Whereas, 2020 has been a mind-boggling year. There has been skepticism about the COVID-19 crisis and the economic recession taking place due to it.
However, Bitcoin does not seem much affected in the course of this turmoil. In fact, a 5% increase in bitcoin price was witnessed amid the crisis and it is articulated that Bitcoin has been the best performing asset in the last decade.
Will the Bitcoin halving pump the bitcoin price?
In the midst of this unpredictable economic situation, Investors think that the Bitcoin will outshine in the coming months after the much-awaited Bitcoin Halving event is round the corner. This event is expected to take place on 12 May for the third time, on this day the Bitcoin miners will be rewarded with just 50% of their expected yield.
This happens after every four years once the maximum supply i.e. 21 million bitcoins get produced by the network and it is expected that the price of each bitcoin could go up by $20000 and beyond by the end of 2020.
The Dollar inflation and Rise of bitcoin
Bitcoin could come into global favor as the value of the dollar falls respective to other assets. This will lead to dollar inflation, as the Federal Reserve will boost up their process of creating dollars. For instance, during the 2008 financial crash, huge amounts of dollars were created but we never saw any significant consumer price inflation.
To fire up the economy, many Americans are receiving $1,200 stimulus checks under the CARES Act. The chief of U.S Bitcoin Exchange Coinbase said that some of this money has ended up in bitcoin.
After all these years bitcoin is still the king of the hill with consistently outperforming other major assets like gold. We are seeing a collapse in the price of some important commodities. The Longest Bull run in the US stock market is now over.
The pandemic has also led to strong movements in the fixed-income markets. This definitely means that we can see a significant rise in the price of bitcoin this year.
Can bitcoin be considered as a safe-haven?
A new Bloomberg report suggested that bitcoin and other cryptocurrencies are preparing for a mahoosive bull run. This means bitcoin can finally transit from a risk-on speculative asset to a safe-haven. The volatility of bitcoin is unpredictable, hence it is recommended to invest carefully.
With Ongoing buzz of Bitcoin price and the Pandemic effect on the global economy, it is the fact that many countries and fortune companies are taking steps to Adopt blockchain technology and bitcoin payments as a precautionary and damage control asset. This will surely cover 2020 and bitcoin has the chance to repeat the spike of 2017 Dec .
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