The price of bitcoin (BTC) is undoubtedly the most discussed topic within the crypto community. Every day several traders and industry experts analyse the market trying to predict the trend of bitcoin (BTC) and the price it could reach, along with other cryptocurrencies.
In recent months, several pieces of news have invaded the crypto market and the most important is undoubtedly the launch of Bakkt, which will take place on September 23rd, 2019. After having “survived” several statements that declared it “dead“, the world’s largest cryptocurrency by market capitalisation continues to grow day by day, in terms of adoption.
Here are some of the possible reasons why 2020 could be a perfect year for bitcoin (BTC).
1 – Bitcoin (BTC) halving
Bitcoin (BTC) halving is undoubtedly one of the most anticipated events which will take place on May 17th, 2020. As a result, the mining reward will be halved, affecting the overall supply of bitcoin (BTC). This is the third event of its kind.
Litecoin (LTC) has recently also been a protagonist of a halving and has responded positively to this event, increasing its value.
The first time, the mining reward went up from 50 to 25 BTC in 2012. Subsequently, in 2016, it was again reduced to 12.5 and on May 17th, 2020 it will be reduced to 6.25 BTC for each confirmed block. Statistically, and historically, the price of bitcoin (BTC) has always increased when approaching a halving.
2 – Bitcoin and the comparison with gold
Gold has increased significantly in recent years and BTC is not far from replicating the same trend. BTC is referred to as “digital gold” for this very reason and many treat it as a safe haven from traditional markets that are in sharp decline.
3 – Facebook and its cryptocurrency: Libra
Facebook’s cryptocurrency, Libra, which is expected to be launched in 2020, has been instrumental in helping many people learn more about cryptocurrencies. It has certainly drawn a lot of attention to Bitcoin and altcoins, although it differs considerably from BTC in terms of technology and use cases.
But most importantly, there is a regulatory issue. After Facebook’s move, many governments are now thinking about how to tackle crypto and related legislation.
4 – Rising inflation
If we consider Venezuela or Iran, inflation has been a serious threat to several countries in recent years. Bitcoin is far from mass adoption but remains a viable alternative for governments seeking a solution to economic crises.
The inflation rate of Bitcoin is programmed. It is 3.74% per year and cannot change.
5 – Mass adoption
As already mentioned, BTC has a long way to go before it can reach mass adoption. New Zealand, the United States and the European Union seem to be increasingly interested in cryptocurrencies every day. The fact that a country allows salaries to be paid in bitcoin and that they are taxed says a lot.
In addition, there are several companies that are now adopting BTC, from telecommunication and technology to food, tourism and much more.
6 – Bitcoin (BTC): a limited supply
Thanks to the technology underlying the development of Bitcoin Core, the amount of bitcoin is fixed at 21 million. Since it is not unlimited, it has a great resemblance to gold and silver which also have limited quantities (although the quantity is obviously unknown).
Bitcoin can be transferred digitally and very easily. In the digital age we’re living in today, it’s an added value that has the potential to take over with the passing of time.