Bitcoin price has gone up about 300%. Many Bitcoin investors are wondering if this rise will continue in 2021, and beyond. In addition, many people who have not bought Bitcoin are interested in wondering what the true expectations of Bitcoin's price evolution will be in the next few years.
Below, we have listed some of the developments that are likely to drive the Bitcoin price prediction 2021-2025.
More and more crypto wallets
More and more crypto wallets are popping up. This wallet allows users to securely store and trade bitcoins. The number of active wallets has also increased, which means more and more people are actively trading Bitcoin. This will lead to an increase in the price of Bitcoin in the long run as the increase in active wallets is a result of the increased demand for Bitcoin. This page from Glassnode, a leading cryptocurrency data analysis company, shows how many wallets have been added over time.
Bitcoin price prediction 2021-2025
The price of Bitcoin has fluctuated widely in the past. However, it is surprising that an uptrend is always visible from time to time. The question is why this will be different in the next 5 years. Bitcoin is still in its infancy, financial institutions are seeing a lot of money being made from Bitcoin, and more and more individuals in Western and non-Western countries own Bitcoin.
Since the last rise in 2017, a number of trends have emerged, these trends collectively will indicate a further increase in Bitcoin price in 2021-2025. Therefore, the price increase in the coming years is seen by many analysts as a realistic expectation of Bitcoin. This is a good reason to keep an eye on Bitcoin's development in the years to come.
May 2020 price drop
In May last year, the so-called "halving" took place. This is the moment when the reward that the miner receives for finding a new block is divided by two. To be clear, this is the value of the prize, not Bitcoin itself.
A new halving occurs every 4 years. The first time was on November 28, 2012, so this year is the third time. This time, the prize was halved from 12.5 BTC to 6.25 BTC.
Why does this halving exist?
Just because of the principle of supply and demand. By halving the reward, the reduced amount of Bitcoin is reduced. This increases supply while not having an impact on increasing demand. In this way, the value of Bitcoin cannot fall on its own system, but in principle can continue to increase indefinitely.
How does the halving affect the value of Bitcoin?
Logically, if demand increases faster than supply, you will see an increase in value. That's what happens after each start:
- In 2012, the value of BTC changed from $11 to $1000
- In 2016, the value increased from $700 to $20,000
- So why didn't it happen this year?
- There are many explanations for this, but these are the two main reasons:
Thanks to this halving of the year, we can probably expect further BTC gains for the rest of 2020.
New Bitcoins, on the other hand, are issued at a predetermined rate. This makes it possible to control depreciation and inflation in advance.