- The Bitcoin halving is only a few days away and Bitcoin continues to show a sideways trend.
- Industry experts are currently discussing whether Altcoins such as XRP or Litecoin can also benefit from BTC halving.
Bitcoin halving is considered to be a potential catalyst for an increasing Bitcoin price. However, this year’s halving event cannot be compared to past halvings as the market has matured more significantly according to some experts such as Binance founder Changpeng Zhao. What is certain is that the reward per block mined will be reduced from 12.5 to 6.25 Bitcoin, which means that Bitcoin miners can expect significant sales losses.
Effects of Bitcoin halving on other cryptocurrencies
If the Bitcoin price rises, driven by the halving, then altcoins such as XRP and Litecoin could also benefit in the long term. A recently published study by Binance shows that the correlation between Bitcoin and the Altcoin market remains strong. Ether (ETH), Dash, Ripple (XRP), Bitcoin Cash (BCH), Monero (XMR) and EOS show the highest correlation with a rate between 74% and 82%.
The Ethereum price, with 82%, shows the highest correlation with Bitcoin within the last 3 months. Furthermore, Bitcoin is tradable against almost all altcoins, so that there is a further dependency, although the available trading pairs with Fiat currencies and other altcoins continue to increase. Bitcoin’s market capitalization is more than half of the total crypto market (64.1%), so price movements of Bitcoin have always had a significant impact on the altcoin market.
Pierce Crosby, Managing Director of Trading View, describes that Bitcoin and the altcoin market have always been strongly correlated:
Everything correlates to Bitcoin, much like in the U.S. equity market, everything correlates to the U.S. dollar. Bitcoin is the largest store of wealth for the asset class, so everything is basically ‘pegged’ against its overall performance.
Van de Poppe, a full-time trader on the Amsterdam Stock…