How to grasp the half effect of BTC
Based on these two situations, price fluctuation seems to occur within 18 months after each halving. However, the data is still insufficient for proper analysis and price forecasting model
Will history repeat itself< p> It is important to note that in terms of the number of bitcoin holders, market value, regulations and the overall outlook for cryptocurrency, there are huge differences between 2012, 2016 and 2020. For example:market value: November 2016 - & gt; $11 billion, December 2019 - $132 billion
daily trading volume: November 2016 - & gt; 84 million US dollars, December 2019 - 17 billion US dollars
e to the increased public awareness of bitcoin and the interest of institutional investors, the risk is higher this time. Although many other cryptocurrencies have been introced since 2016, BTC's dominant position is still 66.6%. As a result, the bitcoin miner is unlikely to switch to other coins, which means that halving may have a long-term impact on bitcoin prices
However, the main gain is that there is a certain correlation between the halving of bitcoin reward and the price fluctuation after the event. These supply changes happen every four years, and it's interesting to watch their impact on the price of the bitcoinThe reasons for the sharp rise of bitcoin are very complex, mainly e to the continuous admission of institutional users through the compliance channel. In short, many bitcoin holders do not really understand bitcoin itself, but just regard it as an investment proct with huge profits, but ignore its risks
the concept of bitcoin was first proposed by Nakamoto on November 1, 2008, and was officially born on January 3, 2009. According to the idea of Nakamoto, the open source software is designed and released, and the P2P network on it is constructed. Bitcoin is a virtual encrypted digital currency in the form of P2P. Point to point transmission means a decentralized payment system
unlike all currencies, bitcoin does not rely on specific currency institutions. It is generated by a large number of calculations based on specific algorithms. Bitcoin economy uses the distributed database composed of many nodes in the whole P2P network to confirm and record all transactions, and uses the design of cryptography to ensure the security of all aspects of currency circulation
e to the decentralized programming of the bitcoin system, only 25 bitcoins can be obtained every 10 minutes, and by 2140, the maximum number of bitcoins in circulation will reach 21 million. In other words, bitcoin system is able to achieve self-sufficiency, resist inflation through coding, and prevent others from destroying these codes
Speaking of many investments nowadays, maybe many people are more and more inclined to stock funds, and will hold some gold bitcoin and so on. In fact, in many cases, this type of investment also has risks, so we need to have a good investment habit no matter what. Recently, in the bitcoin transaction, It can also be seen that many people began to buy, and he made history and was the highest. What happened
Bitcoin network generates a new block every ten minutes. Every time a miner completes a block, he can get a certain amount of bitcoin as a block reward, and the reward will be halved for every 210000 blocks mined. Because the time for mining each block is limited to 10 minutes, at this rate, the period for the reward to be halved is four years, that is to say, the reward for bitcoin blocks is halved every four years
when the bitcoin block reward was halved for the first time, its price rose 25 times from 300 yuan to 7995 yuan; In the second half, the price rose 28 times from 5011 yuan to 140000 yuan. So many people predict that the third halving of bitcoin in May 2020 will lead to a sharp rise in the price of bitcoin, at least 10 times. However, these figures are not so clear. After halving in 2012, bitcoin prices rose for two months, and in 2016, there was almost no immediate response to deflation for a month. This may also be the result of the strategy of "buying rumors and selling news" implemented by some speculators
extended data:
after bitcoin halved, the supply slowed down, and keeping deflation through algorithm has always been a part of bitcoin protocol design. It was set up to ensure the value of bitcoin. By recing block incentives and setting the maximum possible supply of bitcoin at 21 million bitcoins, bitcoin has an anti inflation feature, which runs counter to the tendency of central banks to print money at will. At present, there are about 17.5 million bitcoins in circulation, and less than 3.5 million bitcoins are available for mining. When the next block award halves, bitcoin's annual inflation rate will drop from the current 3.8% to about 1.8%
maintaining deflation through algorithms has always been a part of the design of bitcoin protocol. It was created to guarantee the value of bitcoin. By recing block incentives and keeping the total amount of bitcoin at 21 million bitcoins, bitcoin is endowed with an anti inflation nature, which is different from the tendency of central banks to print money at will. At present, there are about 17.5 million bitcoins in circulation and less than 3.5 million available for mining. The next block award cut in half could rece bitcoin's annual inflation rate from the current 3.8% to about 1.8%. This will be the first time in bitcoin's history that it has fallen below the historical average of about 2% - 3% growth in gold supply
According to Nakamoto's plan, bitcoin will be halved for the third time around May next year
before and after the previous halving, the price has changed significantly
as long as the BTC value is still there will be profits whenever mining, and some miners will not shut down their machines.
Finally, I saw someone separate blockchain from bitcoin
in fact, bitcoin and blockchain are not the same thing at all. Many people just have a chivalrous understanding
this is what a 36K article says. I think it is very objective
in bitcoin and blockchain, "network effect" is a misunderstood concept, because its internal elements are difficult to be clearly depicted. The internal factors of network effect are multi-dimensional, and not so many people can directly experience great network effect. As consumers, we are only users of this kind of network effect. We think we can understand the network effect from the outside, but it is not enough to judge whether the network effect exists
when we discuss the ecosystem of bitcoin and other cryptocurrencies, we always touch on the topic of "network effect". Many people will misunderstand this and even claim that bitcoin's network effect is the most powerful because of its liquidity and ongoing mining activities. So let's go back and see what "network effect" is
as far as I know, the summary of "network effect" by USV is the most complete:
scale: must be very large
mutual connectivity: in a network, each group or system must have interoperability (this is the basic requirement)
User Participation: at least every day (or every week), a certain percentage (30%) of users will come back for reuse
User Experience: it must be unique, original, and can create some new value when users use it
network effect: when new users are added, the service value of each original user will increase, and the value of the network itself can further increase
defensive: with the growth of the service itself, the value of new users will increase, and the entry threshold will graally strengthen
profitability: when the whole network matures and operates, one or several parts can become a sustainable economic base
What is the ecosystem of network effect In order to evaluate the network effect correctly, we need to look at the ecosystem from three dimensions:1
(2) the components of ecosystem Participants and actors However, if you want to create more network effects, You also need to consider:the number of apps and services
the number of users using apps
the total capital of the market
the number of developers
Security
the ability to scale
dependability
marketing < /p>
if you evaluate bitcoin correctly, you will find that it is still leading as cryptocurrency, its consistency is steadily improving, and the blockchain platform is graally developing. However, there are still many blind spots in its future, such as large-scale ability, and the number of daily active users is not enough. It's too early to judge the network effects of bitcoin and blockchain
don't forget:
without users, there is no network effect
first, many institutions are buying bitcoin recently, and their actions undoubtedly give most retail investors the confidence to buy. After all, since the epidemic, everyone has been pursuing a safe haven asset, and the relevant properties of bitcoin are more in line with this condition, In addition, bitcoin's ability to cope with inflation is obvious to all
secondly, bitcoin has just experienced a halving in May this year. Generally, the rise and fall of the halving effect graally appeared in the following months, but now it is just a little obvious
thirdly, the promotion of digital RMB helps the society to enter the era of digital currency more quickly, and it is expected that bitcoin, as a leader, will improve its value
fourthly, more young people are in favor of bitcoin, and the recognition of the masses is the power of value promotion.