Bitcoin halving is less than two weeks away, and many within the crypto space are speculating on what effect it will have on everyone involved from miners to traders and, more specifically, to its price. The event takes place every four years, where the block reward is reduced by half. Currently, it stands at 12.5 BTC, and this May will go down to 6.25 BTC. Past halvings have had a positive impact on the price of BTC, and this one is expected to be no different.
The first halving occurred on November 28, 2012, when BTC was trading for $11; a year later, it would hit the $1000 mark. The second halving took place in July of 2016. At the time, BTC was trading for $700, and one year later, it would hit its all-time high of $20,000.
Even though we cannot accurately predict the future, looking at past data, we can only speculate on the impact this event will have on the price of BTC, miners, and traders. Pricewise, we already have positive momentum as BTC has managed to cross $8,000 for the first time in seven weeks.
Considering that two-thirds of Europeans believe in the long-term potential of crypto, will the bullish momentum continue pushing the price higher? Or will traders take profits soon, driving the price down? In this piece, we are going to take a look at how the Bitcoin halving is likely to affect crypto traders.
What Analyst Think
In a recent Livestream, Ivan on Tech, a crypto influencer, analyzed how the halving event was likely to affect the trading behavior of retail investors versus the whales. According to him, he foresees a scenario where days leading to halving, there will be increasing buying demand from retail investors, which will push the price up. However, he warns that this will offer the whales an opportunity to sell large amounts of BTC without crashing its price since the buying demand from retail investors will offset any potential price drop as a result of massive liquidation.
It’s an opinion that many traders have dismissed as pure speculation that isn’t backed by any facts. One trader who goes by the name of Michael van de Poppe says he prefers to watch the charts as they offer him all the data he needs to trade.
How To Trade The Halving
If you like speculating and trust your gut, sites like AlphaPlay allow one to do that. The blockchain platform allows one to bet against other players on which currency between two is likely to experience more gains or fewer losses over a given period. Currently, the platform allows bets on the following crypto pairs BTC, ETH, TRX, and EOS. They have sufficient capitalization for the results to be objective.
The game takes place within intervals of 5 minutes, which makes 12 rounds per hour. The winner is the player who can predict correctly the coin that makes the most gains in % terms against the USD or the least losses within the interval. Users do not buy or sell crypto assets, so they cannot be questioned by the regulators.
Additionally, 90% of the turnover can be won by anyone as prizes, 4% is the reward for active users for playing with friends. Alpha ERC20 hodlers will receive the remaining 6% of all Alpha Gambling turnover as loyalty bonuses. Tokens can be bought on their token sale until August 8, 2020.
Another option for traders is to take is Poppe’s advice, which involves reading the charts since they contain all the information you need to trade.
According to him, there will be a slight rally in the next few weeks as we approach the event, “which makes it a buy the rumor sell the news event. Short term, I just think it’s a big nonevent and doesn’t really matter. But long term, it could kick off a bull market.”
Scott Melker is another trader who recommends that other traders should put their faith in the charts. He says that the beauty of crypto and Bitcoin is that you don’t have to guess what the scenario is going to be like.
Emphasizing you don’t need a narrative given that most people want narratives to know which move they need to make. However, according to him, it’s all in the charts. He adds that good traders are those that are guided by analyzing fundamentals, as this helps one make more informed decisions.
A glance at Google trends reveals that interest in the upcoming halving is at an all-time high compared to the previous events. However, some experienced traders feel it might not be the bullish catalyst many expect since it doesn’t matter; instead, we should be more concerned with other macroeconomic catalysts like unprecedented central bank monetary policies that have the potential to drive the price of Bitcoin up in the coming months and years.
featured image by Darwin Laganzon from Pixabay
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