Reduction of Bitcoin block reward and effect on price

In May 2020, the block reward for Bitcoin will halve for the third time. Based on past performance, the market cap is likely to be calculated in trillions of dollars.

Currently, Bitcoin's market cap stands at $ 142 billion, or $ 0.1 trillion. The highest value achieved was $ 0.3 trillion in December 2017. By comparison, gold on the market has a value of 8 trillion dollars.

That could change after May 2020. Analyzing the evolution of Bitcoin in the wake of the two previous halving events, a multibillion-dollar market cap is not only possible, but also likely. In the past, the significant reduction in the supply of new Bitcoin coins has generated a massive increase in demand.

Bitcoin halving effect in price history:

Before mid-November 2012, the price was $ 12 and the block reward was 50 Bitcoin per block ($600), meaning the market absorbed $ 604,800 in Bitcoin per week. That halving event reduced the offer by $ 302,400 a week, causing the market cap to rise by $ 14 billion the following year.

Before mid-July 2016, the price was $ 650 and 25 bitcoin per block ($16,250) was mined, meaning the market was absorbing $ 16,380,000 a week. That halving event reduced the new offer by $ 8.190,000 a week.

Forecasts for the future:

With Bitcoin worth $ 10,000 before half-life, 12.5 BTC will be mined per block ($125,000). That means $ 126,000,000 goes into the ecosystem a week. This 50 percent cut from May 2020 will generate $ 63,000,000 a week, which could cause a trillion-dollar market increase over the next 2 to 3 years.