2020-5-9 20:34 |
The price of bitcoin is having strong momentum, as it climbed over $10,000, an important psychological level. Jehan Chu of Kenetic Capital said,
“Bitcoin trades sentiment-driven at its peaks and valleys, and the post-halving hangover is part of the normal price ebbs and flows on top of Bitcoin’s fundamental value.”
But the price is not the only factor enjoying a growth, the bitcoin network fundamentals are just as bullish. Given that halving is just around the corner, it isn’t surprising that the network is booming.
Last week we reported that the hash rate of the network has climbed out yet a new all-time high. But if we take a look at both the price and hash rate, they have been moving in complete harmony. TradeBlock noted,
“During periods of declining bitcoin prices and lower mining profitability, mining resource allocation decreased accordingly resulting in lower hash rates.”
Source: TradeBlock Higher prices coming post-halving?Now, about 3 days away, halving or quantitative hardening has gotten bitcoin special attention in the current environment of quantitative easing.
The event that comes every four years will also cut down bitcoin inflation from 3.64% to 1.80%, down from the global inflation rate of 3.56%.
In preparation for this event, bitcoin miners have started hoarding BTC. Post halving, the miners block reward will be reduced in half, from 12.5 BTC to 6.25 coins.
Over the past week, miners have hoarded 1,067 BTC, having sold or distributed less than they have mined. Normally bearish, this close to halving, this hoarding might indicate miners' bullish long term view of bitcoin. Charlie Morris, co-founder & Chairman of ByteTree wrote,
“We normally see this as bearish because it implies a soft bid in the market. With a recent price surge, clearly this hasn’t been the case, and so we can only assume that the miners also think higher prices are coming post-halving.”
Source: ByteTree Only higher value transactions will surviveOver the past week, many things have been “somewhat crazy,” with the difficulty of the network seeing a minor uptick despite the generation cooling down. This might have been flushing out the weaker miners.
Meanwhile, network fees surged subsequently above $4 million, up from below $1 million per week a couple of weeks back. This jump in bitcoin network fees came up with a rise in the number of transactions.
“The positive is that high fees reflect network interest and that is good for the Bitcoin price. The negative is that small transactions will dry up.”
Given that post having would mean miners will get 6,300 BTC plus fees per week instead of the current 12,600 BTC per week, fees need to remain high. But this also means, “only higher value transactions will survive.”
origin »Bitcoin (BTC) на Currencies.ru
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