With the upcoming Bitcoin reward halving many have been making wild predictions. One of the things that makes the Bitcoin Market so interesting to traders is it’s volatility and unpredictability. As a trader you can feel as though you may as well be an amateur throwing darts.
The Block Reward Halving 2016
Reward-Drop ETA date: 07-16-2016 23:15:38
Currently miners share a reward of 25 BTC per block solved, a block is solved every 10 minutes, there are approximately 144 blocks solved per day. This equates to R23,370,967.08 in Bitcoin comes into circulation every day. The block reward halves every 210,000 Blocks (Roughly every 4 years) By our calculations the next Block Reward Halving will take place on the 07-16-2016. On this day the reward will halve to 12.5BTC reward per block, which will mean miners are getting paid half in BTC for their processing power.
What does this mean for the Price Of Bitcoin?
So there has been lot’s of speculation recently as to what will happen to the price once the block reward halves in July later this year. 2016 is going to see a two-fold impact to miners rewards, all the while bitcoins mining difficulty has been increasing year on year without fail. As more and more processing power is needed to complete a block, it is only logical that to keep up the price will have to increase for miners to continue without running at huge losses in our current mining climate.
Assuming Fintech and the demand for digital currencies remains the same or increases over the next 6 months, then basic market theory suggests that there will be a spurt in price.
If we don’t see an increase in price after the halving, we can only assume that many miners will have to cease operations to stay profitable. This in turn may cause a monopolization in mining which is bad news for Bitcoins decentralization.
Nobody knows for sure but here are what some others have speculated will happen after the coming halving.
“If OPEC (Organization of the Petroleum Exporting Countries) came out tomorrow and said, ‘in six months’ time we’re going to halve oil production’, the oil price would instantaneously react.”
With Bitcoin, the future “production” is known and every player already knows that this will happen and on which dates.
Barry Silbert of Bitcoin Magazine said that:
“Bitcoin Price will be higher by the end of 2016”
He did not go into any detail.
The overall sentiment of the market around the block reward halving seems to be bullish we have listed some articles below expressing the views of key players outlook on the event.
What is your opinion on the upcoming block reward halving? And what do you think will happen to Bitcoins price in 2016?