After shooting up from the lows of $4k to the highs of over $13k, Bitcoin went on a shortfall that saw its price drop to $9k. The top crypto is now on its way up again, albeit with some tough resistance at the $9,500 level. However, many traders and analysts expect Bitcoin to spike to $20k or more by the end of 2019 as the network block reward halving draws nearer.
As this happens, Bitcoin miners are concerned about the crypto’s base value relative to the block reward. From a business point of view, the base market value of Bitcoin should be higher than the cost of operation for miners to profit.
New Bitcoin Halving Bubble
Every few years, Bitcoin’s network undergoes a block reward halving whereby the earnings given out for every mined block are halved. At the moment, the reward is 12.5 BTC. After the halving slated for May 2020, that figure will go down to 6.25 BTC, meaning that miners will now get fewer earnings from their mining activities unless the price per coin increases accordingly.
In that regard, miners are working to create more demand for Bitcoin in hopes of bumping up the price for the current earning to level up with the lessened reward. Reports by analysts indicate that miners have been contracting their Bitcoin sales even before the mining happens. That has had the effect of increasing the crypto’s demand and price.
Double The Base Cost
According to ‘Filb Filb’, miners are working to increase the base value for Bitcoin and keep it above $6,500 – which is double the previous base value. In that sense, the block reward value will be maintained even after the halving.
Bitcoin is currently trading at around $10,321 after turning green just a few days after the market turned red. The market cap stands at $184.3 billion, with a market dominance of 65.8%.