The Bitcoin price appears set for a massive breakout as network fundamentals are at all-time highs (ATH) as the 2020 halving event approaches.
Bitcoin Network Metrics at ATH
With the Bitcoin block reward halving less than a year away, the network activity parameters continue to set new ATHs. Data from Blockchain.com shows that metrics like hash rate, difficulty, blockchain size, and unspent transaction (UTXO) count are all at their highest ever levels.
As at press time, the network hash rate is 74.5 quintillion hashes per second (74.5 million tera hashes per second — TH/s). This figure represents an almost 140% increase in the amount of computing power used to secure the network since the late 2018 plunge.
At that time, there were fears of a mining death spiral, as many nodes exited the network due to declining mining profitability occasioned by the 80% drop in BTC price. Fast-forward half a year later and the situation is the complete opposite.
These massive improvements in the network fundamentals have seen an influx of investment into the mining arena. Earlier in July, Northern Bitcoin — a German-based crypto mining company announced that it would be purchasing 5,000 ASICs from Canaan Creative and Bitmain.
Pre-Halving Bitcoin Price ATH?
There is a lot of speculation about the possibility of a new price ATH even before the 2020 block reward halving. Bitcoin is presently accumulating around the $11,000 price mark, a 120% increase since the start of the year.
Crypto trader Craig Cobb of Tradercobb.com predicts will set a new ATH of $27,200. Cobb, however, says bitcoin might see a drop below $9,000 before shooting for a new high above $20,000.
The top-ranked cryptocurrency has seen a few 20 to 30% declines during its 2019 run so far. For Cobb, each pullback only brings BTC back to the “cradle zone” (the price action area within the 10 to 20 period moving average).
As for what happens post-halving, history might provide some insight. After the 2016 block reward halving, the price of BTC increased by more than 900%. This run culminated in mid-December 2017 when bitcoin almost topped $20,000
Price analysis like the stock to flow, model, predict a BTC price of $55,000 by the 2020 halving. A 10x advance like in 2016 would put bitcoin at over $500,000 by the end of 2021. This run, while spectacular might not be enough to save John McAfee and his “jewels.”
By how much do you expect the price of Bitcoin to increase after the 2020 halving event? Let us know in the comments below.
Images via Blockchain.com
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