Bitcoin outlook 2020

Bitcoin outlook 2020

30 January 2020 from Anna Svahn

Bitcoin celebrated its ten years not long ago. In the past decade, the cryptocurrency has gone from being known only in certain circles to, with its companion of investors and developers, really starting to put pressure on the world's banks and central banks. In these ten years, two trillion dollars have been made in transactions, which, although in size compared to other means of transaction, is small, so large that it is no longer possible to deny that the cryptocurrency is beginning to find a given place in the global economy.

Although the Bitcoin price hit some strikes in the second half of 2019, the price for the full year 2019 is up over 90 percent in USD. The year, which started just above USD 3700, closed at almost USD 7200, and has since continued up to USD 8000. Regardless of what the story looks like, the prospects for the future are still obviously interesting, and 2020 is expected to be a really good year for Bitcoin for several reasons, such as the upcoming halving and improvements to the lightning network , a payment network that is on top of Bitcoin's blockchain to make transactions with bitcoin faster and cheaper. 

Halving

One of the most interesting events in 2020 will be the upcoming halving in May. By halving, then, is meant that the "reward" in bitcoin that miners receive for creating a block on the block chain is halved. Today, miners receive 12.5 bitcoin per new block, after halving the same figure will thus be half, or 6.25 bitcoin.

Historically, halving, which leads to a decrease in the supply of bitcoin, has also led to higher prices for the cryptocurrency. If we follow the previous trend, there are those who believe that the price may well be trading around USD 100,000 at the end of the coming bull market, while other analysts say it is very possible that the halving will be a non-event and will not at all to be reflected in the price.

The purpose of the halves is to prevent bitcoin from losing value over time by controlling inflation and stock to flow.

The beginning of a bull market?

As I said, there are divided opinions regarding whether we are facing an upcoming bull market, if the price will fall further or if we continue consolidation around today's levels.

The outlook for the coming year is thus sparse, but for those who believe in further decline, the level of USD 5800 is important. This means that if the price falls and you still believe in the bitcoin case in the long run , it may be a good idea to start scaling in shortly before - if you dare to wait that long.

Legal notice

This information is in the sole responsibility of the guest author and does not necessarily represent the opinion of Bank Vontobel Europe AG or any other company of the Vontobel Group. The further development of the index or a company as well as its share price depends on a large number of company-, group- and sector-specific as well as economic factors. When forming his investment decision, each investor must take into account the risk of price losses. Please note that investing in these products will not generate ongoing income.

The products are not capitalprotected, in the worst case a total loss of the invested capital is possible. In the event of insolvency of the issuer and the guarantor, the investor bears the risk of a total loss of his investment. In any case, investors should note that past performance and / or analysts' opinions are no adequate indicator of future performance. The performance of the underlyings depends on a variety of economic, entrepreneurial and political factors that should be taken into account in the formation of a market expectation.

02/04/2020 22:03:56

 

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