Bitcoin traders and investors are nervously counting down to next week’s bitcoin supply squeeze, known as a bitcoin halving.
The bitcoin halving will see the number of tokens rewarded to those that maintain the bitcoin network. These are miners, cut by half on May 12—with analysts divided over exactly how it will affect the bitcoin price.
However, technical data and sentiment signals are suggesting the bitcoin price could soon make a major move.
Danny Scott, chief executive of U.K-based bitcoin and cryptocurrency exchange CoinCorner says the bitcoin halving is only five days away. Therefores, in the lead up to this event, the firm is seeing a lot of people speculating on what will happen; whether the price will go up or down, or if it will be a non-event. He also added that they are comparing the bitcoin halving to the build up to New Year’s Eve celebrations and warning people not to “focus on short-term price movements.”
“There’s typically a big build up to the night itself. Yet the event is technically over as soon as midnight strikes—this is a similar situation for the halving.”
CoinCorner, along with many other bitcoin exchanges around the world, has recorded an increase in new users signing up over recent months.
“We’ve actually seen a 21% increase in sign ups during April (from the previous month). As a result, it adds to this year’s strong growth in the build up to the halving,” Scott added.
What other crypto exchanges think about bitcoin halving
Elsewhere, the London-based bitcoin exchange Luno claims it will hit 4 million users in coming day; most of them (75%) expect the bitcoin price to be increase by the end of 2020 according to a recent user survey.
Less than 5% of Luno users said they plan to sell their bitcoin over the next six months; more than 90% are expecting to buy more, increase trading or hold on to their crypto over the same period of time.
Luno’s chief executive, Marcus Swanepoel, is also upbeat. He predicts that bitcoin will return to its all-time highs “in the next 12 to 18 months.”
He states that there’s a beginning of a long upward trend. Especially, considering the broader economic environment, it is likely to experience higher volatility, especially in the next few weeks.
Marcus notes that the halving is just around the corner. Consequently, it will be possible to see that same sharp increase common with previous halvings.
Meanwhile, bitcoin’s hash rate, a measure of the computing power at the bitcoin network, has climbed to a fresh all-time high over the past week as miners try to squeeze as many bitcoin from the network as possible before the halving.
On May 3, the one-day average mining hash rate of the bitcoin blockchain reached 139 exahashes per second. The data was compiled by blockchain analysis firm Glassnode.