3 things to focus on bitcoin this week

Bitcoin (BTC) is only a few days away from a historic cross this week: What will retailers and hodlers have in stock in the next few days?

Cointelegraph examines the key factors affecting the market in just over a week before the largest cryptocurrency goes through its third halving.

Only 8 days to halve Bitcoin

The next eight days will focus on a single topic for Bitcoin analysts: the third halving of the block reward. Technically known as “block subsidy halving,” the event will reduce the supply of “new” bitcoins paid to miners by 50%, leaving 6.25 BTC per block.

3 things to focus on bitcoin this week
3 things to focus on bitcoin this week

This one An immediate 50% drop in supply is likely to have a significant impact on demand, especially compared to the historical precedent of the previous two halves.

The effects are clearly summarized in Bitcoin’s stock-to-flow pricing modelWhat suggests that major price movements should occur 1-2 years after halving.

Cointelegraph has reported extensively on the various inventory iterations and their forecasts.

Bitcoin stock-to-flow model from May 4th

Bitcoin’s stock-to-flow model from May 4th. Source: PlanB / Digitalik

BTC has not yet finished with the shares

Bitcoin continues to show copycat behavior that follows movements in the major stock markets.

From Sunday The futures for the SP 500 and Dow Jones fell, among other things, by 3%, which soon led to a further drop in prices for BTC / USD.

At press time, the pair was trading at around $ 8,700, down 3.7% a day after support dropped at $ 8,500.

Corona virus continues to depress moodWhile the United States and China are contesting the origins and management of the pandemic, cause commercial fears.

Bitcoin versus SP 500 1-year chart

Bitcoin and SP 500. 1-year chart. Source: Skew

The fundamentals are at the highest level ever

The foundations of the Bitcoin network are still on an upward trend despite mixed price movements. The hash rate and level of difficulty are close to historical highs.

Bitcoin hash rate 1 year chart

1 year bitcoin hash rate graph. Source: Blockchain

The difficulty is expected to increase by a modest 1.4% on May 5. and it will be the last increase of this kind before halving seven days later.

The two aspects of Bitcoin go hand in hand for analysts, as the automatic mechanism for setting the level of difficulty of Bitcoin prevents manipulation of the delivery rate, regardless of how much BTC is worth in Fiat values.

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