Bitcoin 2020 Forecast

What is the Bitcoin forecast for 2020? This is the question that is on the lips of crypto investors, market analysts and bitcoiners around the world. The beginning of the year is time to review the historical data of the cryptocurrency, analyze its recent development and elaborate forecasts for this year.

After all, there are numerous disagreements about what will happen with Bitcoin in 2020. There are serious people – like John McAffe, one of the most respected figures in the crypto world – who says that the price of Bitcoin can reach one million dollars this year. However, more pessimistic analyses estimate the value at only $ 2,700 per coin.

The Cripto InterCambio blog presents two very different views on the Bitcoin 2020 forecast. The first one takes into account the influence of international politics on the price of the cryptocurrency. The second one focuses on the famous Bitcoin halving, which we will explain below.

Bitcoin 2020 Forecast: the geopolitical vision

In an article published in the Forbes magazine, the investor Clem Chambers states that the price tendency of Bitcoin in 2020 will depend on the development of the trade war between the United States and China. Let’s see why.

China’s influence on the price of Bitcoin

Nowadays China is the biggest power in the Bitcoin mining world due to the low prices of its electric power. Currently, it is estimated that around 65% of mining energy is centered in the Asian country. Due to this fact, most of the new Bitcoins are in the hands of the Chinese.

Moreover, as the Chinese population is gigantic and the country’s economy continues to grow, its influence on the price of Bitcoin is enormous. The increasing demand for crypto assets in the country influences the entire world’s crypto market.

Bitcoin and the trade war

Since the president Donald Trump has recently proposed an agreement to de-escalate the commercial war, less Chinese tend to invest in cryptocurrencies. Optimistic about the progress of more traditional businesses, investors tend to opt for traditional investments and a good performance in the country’s economy.

However, if there is no agreement between the countries, the instability of the renminbi (the Chinese currency) is greater, and there is a greater skepticism regarding traditional investments. Considering this, more Chinese tend to invest in Bitcoin.

Therefore, the analyst Clem Chambers claims that the Bitcoin forecast for 2020 depends on the progress of the trade war negotiations between China and the United States, and especially on the re-election of the president Trump this year. Until the elections in the US in November 2020, says Chambers, Bitcoin will remain below $ 6000 per unit.

If Trump wins, the trade agreement may become more difficult, boosting the price of cryptocurrency. If the candidate of the Democratic Party wins, which can lead to a probable end of the trade war, the trend is that the value of the currency won’t rise.

Bitcoin 2020 Forecast: the importance of halving

As we know, each transaction within the Bitcoin network is stored in a kind of a public spreadsheet. Of course, those who prove the validity of these hundreds of thousands of transactions are not people but computers. It should also be noted that transactions are not verified individually, but in blocks (and therefore there is the term “blockchain”).

Associated metaphorically with gold, this process was called mining. For each block of validated transactions, computers are remunerated with a certain amount of Bitcoins. Currently, miners receive 12.5 BTC for each validated block.

For every 210,000 validated blocks, the amount of this compensation is reduced by half. Therefore, the price of the cryptocurrency is deflationary. After all, it is becoming increasingly difficult to get a cryptocurrency. In 2140, the forecast is that all Bitcoins will have been mined.

Halving will raise the price of Bitcoin

Many people bet that Halving will make the Bitcoin price grow. The logic is quite simple: since it’s more difficult to obtain a new cryptocurrency, a unit value tends to increase, provided that the demand for the currency increases or at least remains the same.

That is what happened in the last two Bitcoin halvings. Let’s take a look at the numbers:

First halving (11/28/2012):

  • Reward: 50 to 25 BTCs per validated block;
  • BTC price on the date: $ 12
  • BTC price 5 months later: $ 127

Second halving (07/09/2016),

  • Reward: 25 to 12.5 BTCs per validated block;
  • BTC price on the date: $ 650
  • BTC price 5 months later: $ 758

If the historical trend continues, Bitcoin halving in 2020 will raise the prices. Since the expectations for the event are high, it is very likely that more people are willing to take a chance and invest in this crypto asset.

Most analysts believe that there will be a positive change in the price of the cryptocurrency after the event, although there are big disagreements about the level of the impact. The estimated range goes from $ 20,000 to $ 100,000 per coin.

However, until then the market can fluctuate a lot. At this time, the currency is traded below $ 7,000. Will it keep falling? Or will it stabilize?

Conclusion: 2020, high expectations for Bitcoin

It is always important to be aware of the Bitcoin price forecasts. Even if you invest in other cryptocurrencies, BTC fluctuations affect the crypto world as a whole.

As we have seen, there is a certain disagreement about the direction that the crypto assets will take this year. On the one hand, halving will certainly have some kind of impact on the value of Bitcoin, and most analysts claim that it will be a positive impact.

On the other hand, Bitcoin is not immune to the evolution of the world politics. On the contrary, cryptocurrency is very sensitive to the changes on the international market. In this sense, understanding the most important variables and following international news is important for making right investing decisions this year.

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