Currently ~14M USD worth of Bitcoins are mined a day, ~420M USD a month. After halving we need ~210M USD less new money every single month to stay at the same price.

Just think about it, these numbers are huge (even at the currently dropped prices!). We need 420M USD of new money every single month to just absorb the newly mined Bitcoins at a price of 8k USD (either bought on the market for $ from non-miners or "bought" by the miners for electricity, which also means for $).

If we think about likely above-average investors and assume they can buy $1k worth of Bitcoin every month, we would need 420,000 such investors to just absorb the newly mined Bitcoins.

After halving we need 7M USD less buying power every single day, or 210M USD less every month or 2,520M USD less every year. It would be crazy if this doesn't result in increasing prices medium to long term. Short term the speculative effect of the halving will be a larger driving factor for the price (both up and down), but once the dust about the halving has settled there should be notably less sell pressure and thus slowly but steadily rising prices over time (if the demand stays roughly the same).

And to those thinking that the amount of newly mined Bitcoins is negligible compared to the total daily trading volume and thus saying the halving will have no impact: that's a flawed argument. The big big majority of the daily trading volume is 1) fake volume from stupid exchanges, 2) bots constantly trading back and forth with what ever strategies they use (arbitrage etc.), 3) people day trading, i.e. also trading back and forth to make profits. Only a tiny tiny part of the total trading volume are people actually selling without buying back at a lower (or higher if they screwed up) price and only that volume needs to really be absorbed by new money. I would argue that the newly mined Bitcoins are a decent chunk of that "net sell volume", so they absolutely have a rather large impact on the price.

Submitted March 10, 2020 at 12:15AM by Nesh_ https://ift.tt/331CTLI