In 2019, the price of Bitcoin doubled. This allowed us to be optimistic about the year 2020, which has so far started with a high C. Many cryptic enthusiasts and experts have high hopes for this year. What can be expected in 2020? Below we present the five most important trends that every crypto market observer should pay attention to.
Halving Bitcoin in 2020
One of the most important events in the world of cryptocurrencies – halving, may turn out to be a key aspect in the possible creation of a “bubble” on the cryptocurrency market. Halving is a cyclical event that takes place approximately every four years. According to data from https://www.bitcoinblockhalf.com/ it will take place on 12 May, i.e. in 113 days. During halving, the prize for “digging out” one block will be reduced by half.
Opinions are divided on how this event will affect the Bitcoin course. Taking into account previous halvings, and more specifically what happened to the BTC course about a year after, we can expect increases.
Already some experts say that the Bitcoin price can reach the new ATH. As it will, time will tell.
Bitcoin – digital gold
Bitcoin has been called digital gold for many years, but 2019 was the year when the term became much more realistic. Looking at the gold and Bitcoin exchange rates, it is hard not to notice the similarity.
In fact, the idea of Bitcoin as “digital gold” has become so popular that US Congressman Brad Sherman said that cryptographic assets could pose a serious threat to the dominance of the US dollar in the global economy!
Earlier this year, tensions on the U.S.-Iran line caused a sudden movement in Bitcoin and gold prices. Looking at long-term measurements of the correlation between Bitcoin and gold, we see a very weak relationship between the two assets.
For many people, blockchain and cryptocurrencies technology are hard to understand. When comparing BTC to gold, people find it easier to understand what Bitcoin and crypto are. After all, each of us knows what value gold represents. Besides, you can touch it and see it with the naked eye.
BIP-schnorr, BIP-taproot, BIP-tapscript
Unlike other cryptocurrencies, Bitcoin updates are not very common. This year we can witness the long awaited by specialists soft Bitcoin fork, about which quite an extensive article has appeared on our portal.
Most likely, the above-mentioned BIPs will be implemented in the same update. Taproot and Schnorr are linked. In this article we will not discuss the possible advantages of the planned changes. Undoubtedly, Bitcoin trends in 2020 may be determined by network updates. The details are discussed in this article.
Lightning Network and Liquid Sidechain
In addition to the basic Bitcoin protocol, other layers are also developed. The Lightning network is used as a solution designed mainly for faster, cheaper micropayments. The rapid growth of BTC in 2017 led to a situation where the costs of small transactions exceeded their actual value.
The Blockstream Liquid side chain has seen a significant increase in the amount of Bitcoins and Tether available on the platform over the last few months.
Due to the high centralization of Bitcoin transactions around the exchanges, Liquid may be helpful in reducing congestion in the Bitcoin blockchain. This is mainly a potential “bubble” caused by halving.
Quite a number of Bitcoin developers believe that innovations such as Sidechains and Lightning Network will ultimately cause the destruction of many altcoins. Thus, the altcoin season may not come at all for many cryptic supporters.
An influx of institutional resources
As Forbes rightly points out, the influx of institutional resources may turn out to be a major trend to which particular attention should be paid. We do not know from now on how much influence the institutions controlling FIAT currencies and introducing legal regulations have on cryptocurrency adoption.
The road to obtaining an ETF for Bitcoin is reminiscent of the current “Sisyphonic work”. The example of BAKKT, gives hope for an influx of significant funds coming from institutions. Greyscale has recently announced inflows of $600 million, coming from new investors, mainly from hedge funds.
Various studies and reports also indicate that financial advisors may increase their clients’ exposure to Bitcoins and other cryptocurrencie this year.
Will 2020 be even better than 2019? Which Bitcoin trends in 2020 will play a major role? We invite you to discuss this topic.