BTC Price Outlook: Bitcoin Halving Prompts Crypto Volatility
BITCOIN OUTLOOK – BTC PRICE VOLATILITY ELEVATED AMID BITCOIN HALVING
- BTC price action swings wildly around the highly anticipated Bitcoin halving event
- Halving could boost Bitcoin prices considering the cryptocurrency’s fixed supply
- Bitcoin volatility could remain elevated as traders react to the monumental change
The halving of Bitcoin just happened for the third time since the cryptocurrency was first launched in 2009. Bitcoin halving, an expected event that occurs every four years, is an inherent characteristic of Bitcoin and blockchain mechanics.
Learn More – What is Bitcoin? Understanding Bitcoin Basics
Simply stated, Bitcoin halving is a pre-planned adjustment to the amount of compensation awarded for mining Bitcoin. This helps maintain the fixed Bitcoin supply of about 21 million BTC.
BTC PRICE CHART – BITCOIN HALVING MAY 2020
BTC price volatility accelerated into the May 2020 Bitcoin halving event. This is reflected by the rising average true range, or ATR, on an hourly Bitcoin chart. Bitcoin has plunged by more than 10% from its month-to-date high near the $10,000 price level as key market players, like crypto traders and Bitcoin miners, adjust to the latest halving development.
Bitcoin prices nevertheless trade about 20% higher on balance so far this year. BTC price action, along with gold, gained ground over recent months largely on the back of demand for anti-fiat assets, which follows unprecedented central bank balance sheet growth.
Considering the fixed supply of Bitcoin and gold, this trend has potential to continue as long as liquidity gushes from central bank money printing. Also, news that billionaire hedge fund manager and investor Paul Tudor Jones recently joined the crypto craze is likely a welcomed development for the bull case.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.