Famous crypto analyst Benjamin Cowen has just released one video talk about cyclical price hypotheses supported by many cryptocurrency advocates. By examining Bitcoin's 4-year price trend, Cowen asserted that the king does not follow such a clear pattern.
Bitcoin halving may not cause the price to rise
Bitcoin has experienced two significant price growth periods, each of which came after the halving event - which took place in 2012 and 2016. This is also the reason why many cryptocurrency supporters anticipate an increase. Similar prices will take place when the next halving comes in May.
However, Cowen threw a cold water spoon into this hypothesis when pointing to market data showing that Bitcoin's value growth did not follow this simple 4-year model. Instead, a series of peaks to troughs at some point may appear in the early days of Bitcoin. These trends last longer as its market capitalization grows.
If Cowen is right, then Bitcoin will remain in what analysts call the "accumulation period" until 2022 - when prices will once again start to rise. It is worth noting that Cowen has long been a very optimistic person about Bitcoin and the cryptocurrency market in general. In the past, he has stated that the total market capitalization of cryptocurrencies could exceed $ 11 trillion in the next few years, with Bitcoin reaching a price higher than $ 100,000.
The current economic crisis raises all predictions
Any prediction about the future value of Bitcoin is based on the current global financial crisis, its impact is not yet fully realized. It is likely that the world will soon witness a prolonged period of inflation, high unemployment and weak economic growth. Throughout 11 years of life, cryptocurrencies have not operated in such an environment, and thus their performance over the next few months is unprecedented.
With central banks across the globe eager to "print" a large amount of fiat currencies to stimulate their economies, it is entirely possible that Bitcoin will experience a surge of investment by people who want protect their wealth from inflation. However, weaker economies may also reduce the military's focus on transferring capital to higher, more speculative assets like cryptocurrencies. In fact, the cryptocurrency space is making its way into undiscovered waters, when there is little data to suggest how it will move forward.
Despite economic problems, development and adoption continue to increase. This fact should also be considered when analyzing Bitcoin's growth potential over the next few months. In fact, blockchain technology is on the right track for widespread use in areas such as logistics and Internet-of-thing (IoT). These developments can have a significant impact on pricing.
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According to Bitcoinist
Translated by ToiYeuBitcoin