Bitcoin Growth History And Market Price Changes 2020
Bitcoin has gone through some major price changes throughout the years, with halving being the most notable reason for these changes. The first halving took place in November 2012, and the second took place in July 2016.
Another halving is expected to take place in May 2020. During the first halving, bitcoin rose from $11 to over $1,000. It became immediately clear that halving is the main cause for the price increase, but it can also be altered by demand.
Retail investors can also play a role in bitcoin growth, but they did not expect the halving to take place in 2012, which is why the price increased as it did.
After the initial price increase of over $1,000, the price dropped down into the $250 range. It generally stayed right around that mark until the second halving in 2016. The bitcoin price rose to close to $700 with that halving and hovered around this price for a few months before a large increase began.
On December 17, 2017, bitcoin reached a price of $19,665.36, which is to this date the largest price recorded.
The initial mining reward for bitcoin was 50btc, and 10,500,000 btc were mined before the first mining. This caused a huge supply, with not much change in price, but eventually, demand for bitcoin started to go up.
When bitcoin was first halved in 2012, the mining reward was decreased to just 25 btc.
After the 2016 halving of bitcoin took place, there were only 5,250,000 btc left to be mined. The mining reward then decreased to just 12.5 btc.
When the next halving takes place in May 2020, there will be just 2,625,000 btc left to be mined.
Here is a brief chart as to what the halving process did to bitcoin prices:
Halving Year Initial Price Highest Price Increase
First 2012 $11 Around $1,100 Price increased 100x
Second 2016 Right at $700 All-time high of $19,665.26 Increase of over 33x
It is interesting to note that while the price increased more during the 2012 halving, there was more of a demand after the 2016 halving. The price also got much higher, despite there being a lower percentage increase.
Is it caused by the halving effect?
Is it caused by retail investors or manipulation of whales?
The two biggest factors that lead to an increase in bitcoin prices are the increase in demand and the halving effect.
In 2012, people did not invest in bitcoin as much as they did after the 2016 halving, and this happened for a few reasons. People did not know the effect that halving would have on bitcoin prices, and people didn’t know what bitcoin was in 2012.
Investors were prepared for the 2016 halving, and people began investing in bitcoin leading up to this date. There is no bitcoin market cap at this time like there was in 2016-17.
The price increase in 2016 was greatly caused by investors. Investors began increasing their investments on bitcoin because they saw that the supply of btc was being cut.
Halving definitely had an effect on the increase of pricing, but it can mostly be attributed to investors.
A whale is someone that holds over 1,000 to $1 million bitcoin, and whales currently hold over 42 percent of all bitcoin on the market. Around half of the bitcoin valuation from March 2017 to March 2018 was caused by trades between a stable currency and bitcoin.
It is reported that all of these trades were made by one individual. Whales are playing a huge role in bitcoin pricing.
Whales manipulation accounted for about half of the investment in bitcoin, but that still leaves plenty of room for retail investors. Retail investors that hold and trade bitcoin also increase the market cap and provide an increase in the price of bitcoin.
Bitcoin will be halved again in May 2020, but things got a little interesting for the bitcoin market price at the beginning of the year. Bitcoin prices dropped below $8,000 for the first time since the 2016 halving, and there was one night where the price dropped 12% overnight.
There are plenty of factors playing a role in this, including the fear of the coronavirus.
There are only 21 million bitcoin available, and there will be just 2,625,000 left to be mined in 2020. It should be noted that halving generally has a lesser impact with the lower number of btc left to be mined.
That would lead to a lower price of bitcoin, but that’s not what some people believe will happen. A senior cryptocurrency executive believes that an unforeseen event will take bitcoin prices to an all-time high.
Even though bitcoin prices have dropped tremendously over the last few months at the beginning of 2020, there are plenty of reasons to believe in a rebound.
Halving will still have an effect on bitcoin prices in 2020, but not as it has in the last two halvings.
One of the biggest reasons that the price will increase is that whales and retail investors are going to pump money into the industry. Whales will manipulate the prices, and investors will pay what they need to get involved.
There are also other people who have a fear of missing out on the bitcoin industry, and their demand will help to grow the prices. Even though the prices have dropped to begin 2020, there is reason to believe that they will rise again at the halving, and will continue to rise into 2021.
Expect a bull run on bitcoin to occur in 2020 and continue into 2021. This bull run will be similar to what took place in 2012, but whales and investors will play a huge role in increasing prices.
Halving will still have an effect on the market in May, but other factors will play a larger role. Check out Bitcoin gambling guide, for more crypto opportunities