Ok ok ok, one moment, folks - be careful!
A lot random stories circulate out there and every single author thinks he or she can explain how the world works (including me 😅)!
First, let's clear one basic thing out and then lets think as rational as we can what really happens out there.
What is Bitcoin Halving?
With validating the transaction with the consensus Proof of Work, the Validator gets Block Rewards (I guess for most of you, this should be nothing new).
After a period of time (roughly 4 years) this amount will be reduced in half which makes Bitcoin mining more expensive and difficult.
This is called the Halving Event.
Bitcoin has undergone three halving events:
- The first one in November 2012 with Block-Reward-Reducing from 50 Bitcoin per block to 25 BTC
- The second in July 2016 to 12.5 BTC
- And the third on 11th May 2020 with Block-Reward-Reducing to 6.25 Bitcoin.
Naturally this impacts the price of a Bitcoin, as we can imagine. So this has a big effect to the market.
So there many people trying to predict how the effect will look like.
Focusing the wrong factor for Side-Effect
There are some people out there saying, it should let the price decreasing and some are saying it should let it increasing. So, whats true then?
One of the arguments for decreasing is, because of selling the bitcoins heavily of saving assets, which effects on price (well, yes - but we need to have a look closer, what really happens - I explain later on).
One of the arguments, why it shall increase is, well, the supply at the next time frame is reduced...
What a smartass am I, to tell you what really happens? Let me explain:
First of all, it's just normal that people are selling many BTCs after halving, because they really want to save assets to something more stable (Its not only on halving events - this is called Correction. If many people do so, the demand is reducing shortly, that's why the price decreases (which is not bad - I´ll explain later again). But mostly the price is no bulling down heavily, it is just in a correction, as I said - which is good.
I have written about the healthy correction in my last post Upcomming 2020 Trend?
Because of the decreases price, but long-term increased, many people see hope price will increase again. That's why the price is really increasing, because the demand is raising! Really, as simple as that.
This is what basically naturally is happening, which is you can see on every market by the way 😉🙂.
So the real magic is a real big other factor, most people forget.
I am really sorry, if I take you that magic away 😋
Manipulation does not mean Prediction
Please keep in mind, price-increasing and -decreasing is NOT based on a single event. Its a rat-tail, which could be different ones. The market itself runs on human psychology and NOT on physically constants! Its very import to to remind.
I want to give you a game-theory-like example:
A big author, who has a great coverage, is saying 'the price gonna decrease', what do you thing what will happen? Well yes, most people try to save their assets, so the sell those.
Then this big author says 'the price has fallen, so its perfect to buy at these low price'. Well, what do you think what will happen next? Hahaha, yes - Price will increase because of the big demand.
There is no real Guru who can predict what really will happen, its because every one is listening to him what they should do!
So at the end, its a big Game of Gurus, let's say. And because of that, it seems to be they are right with this prediction, so everyone believes next time!
This is called pump-and-dump. Communities can decide consciously or it get to be initialized by Gurus.
Its all up to the Mass-Effect!
The Mass-Effect is based on good networking - like snowball effect. You or we could do the same.
This is on some communities called a Train, which is initialized by a big-player-campaign.
Negative effects are positive long-term
Sounds weird, right? hehe 😜
But you know, I guess - We all have Hope the crypto-world will be the future. Let's say, we are the future. As long as we believe in it and work on it, the more this will become true. I really believe, the crypto-market will not break down. But we also have to keep in mind, just only few projects will survive. And we decide which this will be.
So what I want to tell you is, if there are projects in which you really believe, that contribute to it and buy at low price. Long-term you can win. But for that to work, concentrate your power and have a good eye on what happens next to you. Then it will be worth it to use bulls.
Ok, I gonna stop annoying you. Stay healthy and lets work on the future! 😎
Some stunning References
Very interesting post and I agree with your point on very few projects will survive in the long run.
I recently made a long-term price analysis of Bitcoin as well but it is more of a technical analysis. I wonder if you have read about the Stock-to-flow model for Bitcoin?
I heard about Stock-to-flow before bit never had a deeper look. Thank you for this keyword. I gonna have a deeper look into. If you have some posts of you or other resources, fell free to share! 😃🙂
Your logn-term price analyses sound stunning to me
Thank you very much for your Support! 😁😄🙃🙂
You are welcome! And thanks for visiting my post 😀
Dear @equaliser
One of those posts, which surely are worth checking out and reading through.
I wish you would publish it within Project.hope community.
Both can be very true. Depending on time frame which we're taking into consideration.
Yours, Piotr
Hi Piotr 😄
I cross-posted this into you community. You as @project.hope commented, as you can see above of these comments. But I am wondering, if this is shown. I notice since a few days not all posts are viewable in all networks currently 🤔
Thank you very much for your support. I very like to share posts like these in your community.
Best Greetings
Here is my post in your Community I cross-posted recently
🙂
Dear @equaliser
Thank you for posting within our community.
Please spare few minutes and read how project.hope is organized and learn about our economy.
That would help you understand more our goals and how are we trying to achieve them. Hopefully you will join our community and become strong part of it :)
Yours,
Piotr