The effect of the upcoming halving has not yet been taken into account in the price of bitcoin, which means that after reducing the reward, we can see an increase in the BTC rate, says CEO of Binance.
Bitcoin halving, which is expected to happen in May 2020, has not yet been taken into account by the current price of bitcoin. The fact that miners will get reduced reward for mined blocks can double the rate of cryptocurrency, says Binance CEO Changpeng Zhao.
In an interview with BlockTV, Changpeng Zhao predicted the upcoming upward movement of the bitcoin price ahead of the May halving.
“I personally believe the halving has not been priced in. But this is a personal opinion, and I could very well be wrong.”
As evidence of his point of view, Zhao recalled the effect of previous halvings, and also suggested that, due to a decrease in the number of coins mined, the gap between supply and demand will increase.
"The side of demand is increasing, the side of supply is decreasing."
Zhao added that past events are not always able to predict the future, but he believes that miners will not want to sell mined bitcoins with loss or at low profit, which will lead to a decrease in supply and an increase in demand.
Zhao also expects an influx of new cryptocurrency users and investors.
Despite the investment interest caused by halving in May, bitcoin will continue to fluctuate around the $10,000 mark. According to Zhao, there is a psychological barrier around “beautiful round numbers,” such as $ 10,000, which causes current market volatility.
The recent report by research firm Tradeblock claims that the cost of mining one BTC will increase from $6,800 to $12,500 after reducing block rewards.