The price of Bitcoin (BTC) was the strongest performance in history in the second quarter after a massive decline on March 13, when the price fell below $ 3,600 before finally exceeding $ 10,000 in the next three months.
Skew researcher they said::
“Bitcoin today has its third-best quarterly closing in its young history.”
Bitcoin’s quarterly performance over the past 6 years. Source: Skew
Three key catalysts that fueled Bitcoin’s historic run from April to June were: Halving the reward per block on May 11th, demand for BTC at low prices for several years and a strong recovery in global equity markets.
Halve the reward per block
On May 11, the Bitcoin blockchain network went through the third half of the block reward. This reduction is expected to cut BTC’s production rate in half as Bitcoin is approaching its fixed offer of $ 21 million.
After this reduction has taken place Miners immediately saw a drop in profits of almost 50% and were pressured to cope with falling profits. This resulted in the capitulation of talks between miners on the path to reduction.
Still, the bitcoin network hashrate remains at its highest point. In view of the fact that in the past every cut led to an exponential BTC run, the hashrate strength is a very relevant measure and is currently encountering optimism among retailers.
Possibly due to resistance from the mining sector, the price of Bitcoin did not fall sharply after this event, as analysts had predicted.
The crash at $ 3,600 has spurred demand for BTC
When the Bitcoin price under BitMEX fell below $ 3,600, Demand rose on the major US stock exchanges. Many retail investors quickly bought Bitcoin at the $ 4,000 level, which led to a rapid recovery to $ 5,800 and then to $ 10,000.
At the end of March, Coinbase said:
Since the fall, Bitcoin and the huge cryptocurrency ecosystem have recovered as stocks continue to fall (SP -6% vs. Bitcoin + 23% as of March 27). Coinbase customers in particular have illustrated this buying behavior during and after the autumn. “
Bitcoin has been recovering strongly since March. Source: Blockchain.com
Just a month before the crash, Bitcoin’s price hovered around $ 10,000, with many analysts finding the price testing a multi-year resistance level of $ 10,500 and flirting with the possible start of a bull market.
Although the price fell below 50%, this BTC story above USD 10,500 that triggered a bull market remained attractive and contributed to the growth in retail demand.
Stock market recovery
The total number of coronavirus infections has increased rapidly since the end of March. As of June 30, Worldometer data show that more than 10.5 million cases have been confirmed.
Regardless of the effects of the coronavirus pandemic The unprecedented amounts of liquidity injected into the markets by the major central banks enabled a strong V-shaped recovery in the stock market.