Bitcoin

The price of Bitcoin, which has been rising strongly approaching the imminent ‘halving’ has suddenly fallen around 20%.

Some analysts thought the retrace was inevitable as BTC had become overvalued, but thought it would occur after the halving, not before.

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Bitcoin

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The price of Bitcoin, which has been rising strongly approaching the imminent ‘halving’ has suddenly fallen around 20%.

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Some analysts thought the retrace was inevitable as BTC had become overvalued, but thought it would occur after the halving, not before. Data suggests that miners are hoarding BTC ahead of the halving.

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It’s worth reflecting on the impact that the halving will have on miners. Once it’s taken place, only 900 new Bitcoin will be entering circulation per day, a sharp decrease from the 1,800 we’ve had for the last four years.

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Many miners will see the expense associated with mining a single Bitcoin rise substantially, far beyond the average of $6,851 reported earlier this year. Some estimates suggest that it could cost anywhere between $12,000 and $15,000 in the not-too-distant future, and this means prices would have to rise substantially if miners have any hope of breaking even.

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It will be interesting to see whether the price breaks through the $10,500 resistance after the halving, or whether some miners will be forced out due to the increased cost of mining a reduced number of coins being created.

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