RATE Group | Bitcoin Halving Can Have Negative Short-Term Effect on BTC Price — Here’s Why
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Bitcoin Halving Can Have Negative Short-Term Effect on BTC Price — Here’s Why

04 Mar Bitcoin Halving Can Have Negative Short-Term Effect on BTC Price — Here’s Why

Posted at 20:09h in Bitcoin News by

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The price of Bitcoin (BTC) has dropped right before and after the two previous block-reward halving events in 2012 and 2016. BTC is demonstrating a similar trend approaching the May 2020 halving.

A theory has emerged that miners tend to sell before the halving to accumulate enough Bitcoin to finance their operations for many months after the halving occurs, allowing them to hold onto the majority of Bitcoin they mine.

Theoretically, such a practice would be beneficial for miners because the break-even price of Bitcoin mining spikes significantly when a block-reward halving occurs. According to James Todaro, head of research at TradeBlock, the break-even price of Bitcoin mining is expected to surge from $7,000 to anywhere between $12,000 and $15,000 after the halving.

“Following the Bitcoin halving, miners’ estimated breakeven costs will rise from ~$7,000 today to ~$12,000–15,000 per BTC after. I would not be surprised if we see Bitcoin prices rise above these levels so that…

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