Intriguing Crypto Chart Plots Bitcoin Price Over $17,000 in 2020 with Mining Difficulty Prediction
Bitcoin could reach $17,317 in 2020 according to an ‘unorthodox’ analysis of Bitcoin mining difficulty. In 2018, Bitcoin did not have a good year looking at its price, however, in the future things could definitely change.
The Twitter user and analyst @100trillionUSD made a poll a few days ago asking users which would be Bitcoin’s difficulty in two years. The majority of the respondents (59%) answered that it is going to grow ten times (50E12). 27% answered that it is going to grow 100X up to 500E12. Just a few of the respondents (7%) said that it is going to be reduced by 50%.
In another tweet, the analyst said that based on the results of the poll, an unorthodox prediction will place Bitcoin’s price close to $17,317 in two years from now. By the end of 2020, Bitcoin would have to grow more than 300%.
According to the analyst, Bitcoin price and difficulty seem to have a power law relationship. He showed the formula used to determine Bitcoin’s price in the future. He said that the relationship can be explained as follows:
“Price=0.005*Difficulty^0.46 like Kepler’s third law: Orbital period=Distance to the sun^1.5”
Applying the Bitcoin difficulty from the poll to this formula, Bitcoin’s price should be close to $17,317.
At the same time, he shared a picture in which he analysed Bitcoin’s price taking into account other possible Bitcoin difficulties. In this way, it is possible for Bitcoin to be worth $28,873 if Bitcoin’s difficulty grows 100x.
Bitcoin’s hash rate has been growing since the beginning of the year until August 2018. However, in the last few months, the network’s hash rate has dropped 50% from its all-time high. This drop in the hash rate is related to the fact that Bitcoin’s price has dropped also 50% during the same period of time.
Miners in the market were not able to keep their operations with the current price levels. The rewards received by miners are not enough to cover the expenses related to mining them. Most of the inefficient miners had to shut down their operations.
Due to this situation, the mining difficulty in the network has also dropped in order to let new miners or those that left the space, enter the market once again.
The Bitcoin prediction made by this analyst is one of the most conservatives for 2020. Several analysts predict that Bitcoin will already surpass its all-time high registered in 2017. Whether that’s possible or not remains to be seen.
Currently, Bitcoin is being traded close to $4,175 and it has a market capitalization of $72.84 billion.