The Bitcoin price curve is close to the growth trend of the second halving. The Ecoinometrics model predicts a price of USD 20,000 by mid-October.
After the third Bitcoin halving last March 11th, the evolution of Bitcoin’s price has remained very close to the trend that it had recorded after its second halving in July 2016. This suggests that the growth of this new bullish cycle could maintain similar proportions.
Last August’s Ecoinometrics bulletin shows a comparison between the current cycle in the price of Bitcoin and what happened in the two previous halvings, which seeks to find similarities with the past bullish periods. According to their calculations, Bitcoin could appreciate to USD 387,000 by May 2021, if it maintains a behavior similar to that of the past.
Ecoinometrics projects Bitcoin’s price by incorporating it into the growth bands after the previous halvings, rather than looking at a single timeline. It starts at the time that the third halving occurs and that same point becomes the origin of the curves of the two previous halvings.
In this way, the line that marks the evolution of the second halving remains the base curve. Concerning the price curve after the first halving, of stronger growth, it is the line that defines the upper limit of the band, in which the current price line should move.
There is also a line that marks the average of the price evolutions according to the trends of the first and second halvings. This average reaches USD 20,000 in the first days of October and ends the year with USD 41,000.
According to this hypothetical situation, the average price curve of Bitcoin would cross the USD 100,000 mark on April 18th, 2021, and reach an all-time high of USD 387,000 on May 12th of that same year. Bitcoin’s price, four and a half months after the third halving, looks closer to the curve of the second halving than to the upper limit that the curve of the first halving marked.
Concerning the dimensions of this growth, Ecoinometrics told skeptics that Bitcoin is competing with gold as hard money and store of value worldwide. In this sense, it should reach a market capitalization close to USD 9 trillion to compare with the precious metal. Currently, Bitcoin’s capitalization is more than USD 196 billion, so it still has a long way to go before reaching that level. Therefore, its price per unit would be around USD 400,000 if it did.
After the relationship between the bubbles that occurred after the first and second halvings, Bitcoin recorded similar patterns in its price cycles. After these, it recorded bullish trends, but they had two differences compared to the first and second halvings. While the bullish momentum following the first halving occurred shortly after this, the rise following the second halving took more than a year and a half to take place.
By Alexander Salazar
