If you are not a regular follower of the bitcoin news, then you probably have missed the next big news for the upcoming year. It is called “halving of the bitcoin.” The event will reduce the generation of cryptocurrency by almost 50%.
The event about to take place in May 2020 would slash the number of new coins. The significant change worth around $120 billion would shake the future of the cryptocurrency market to a great extent. Already the active players in this market are becoming aware of the drastic changes that would bring upon them, and are preparing for the huge price gain. This volatile scenario, which roughly takes place after every four years, has been the topic of discussion among the traders, bitcoin miners, and market participants. They are trying to find a way for the next halving that would help them to gain an edge.
As per the theory, if there is a cut-down in supply and the demand remains constant, there would be a steep rise in the prices. Industry experts and traders have stated that May halving could lead to higher volatility in the trading volumes.
Price swings to help make money
Many of the Bitcoin miners are using the latest high-tech computers for competing against other machines in the cryptocurrency world.
They are receiving the set of bitcoins currently at 12.5. The next halving to take place in May, would drop the number to 6.25.
The two halvings took place in July 2016, and November 2012. Bitcoin’s value rose to almost 80 times in 2012, and later four times in 2016. The volatility in the bitcoin markets would benefit the traders working in the cryptocurrency industry, as they could make the profit with even a small change in price. The miners who currently hold large amounts of bitcoin do not want any volatility. A stable price would help them with greater predictability of the investment opportunity in the next year. They can later earn more number of bitcoins in the process.