Morgan Creek Digital co-founder Anthony “Pomp” Pompliano says May’s halving event is not yet priced into the value of bitcoin.
According to a tweet published April 6, Pomp argued against the idea that bitcoin’s price is reflecting the impact of May’s halving event. Pomp gave a simple supply and demand explanation, saying that investor demand for bitcoin would have to undergo a sudden reduction in order to keep pace with the drop in new coins being produced.
The argument of “the Bitcoin halving is priced in” is dumb.
If incoming daily supply drops 50%, then you would need a 50% drop in daily demand as well to keep the same price.
Good luck if your thesis is built on the idea that demand for Bitcoin is going to drop 50%.
— Pomp 🌪 (@APompliano) April 6, 2020
Despite March’s market volatility, which saw the price of bitcoin dip to $3,600 in the single worst day of losses for BTC, investors are looking to May and beyond as a potential bullish platform for the cryptoasset. Bitcoin is projected to undergo its next block reward halving on May 13, which will reduce the number of new coins mined from 12.5 BTC to 6.25 BTC.
Bitcoin halvings occur in regular intervals every four years. According to some analysts, the extensive lead time allows for the market to “price in” the value of each halving well ahead of the actual reduction.
Other proponents, such as Pomp, say that supply and demand post-halving has the largest impact on BTC price.
Such an easy concept that you can explain it in emojis!
— Pomp 🌪 (@APompliano) April 6, 2020
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