Top 5 Bitcoin trends and events to watch in 2020

by Andy Mora

2019 was good year for cryptocurrency, the price of Bitcoin doubled. Many cryptocurrency enthusiasts and experts have high hopes for this year as well. What can we expect in 2020?

I would like to present here the 5 most important trends and events related to Bitcoin that every cryptocurrency market observer should pay attention to.

The rise of Bitcoin as safe haven asset

Bitcoin has been called digital gold for many years. The status of BTC as store of value recently became even much more realistic. When we look at the data on the exchange rate of gold and Bitcoin, it's hard not to notice the similarity. In fact, the idea of ​​Bitcoin as "digital gold" has become so popular that US Congressman Brad Sherman said that cryptographic assets can pose a serious threat to the dominance of the US dollar in the global economy.

Situation in the Middle East is and the tension on the United States-Iran line caused a sharp movement in Bitcoin and gold prices. Every time when standard economy (Fiat money, stock market) is endangered we observe increased interest in alternative investment vehicles such as cryptocurrency or precious metals.

Cryptocurrency is not yet so popular because it is still quite young and for some people, blockchain technology and cryptocurrencies are hard to understand. So comparing BTC to gold, it is easier for people to understand what Bitcoin and cryptocurrencies are.

Bitcoin technical upgrade, soft-fork: BIP Schnorr, BIP Taproot, BIP Tapscript

Bitcoin is not updated very often, but when it does, then any update is considered a huge milestone. This year, we can witness the Bitcoin soft fork, long awaited by specialists – introduction Taproot/Schnorr functionality should greatly upgrade the potential of BTC. With Taproot we will achieve next level of privacy – every transaction – no matter how complicated they will be, will look exactly the same to the outside observers. Schnorr, will allow to aggregate and shorten digital signatures. With these both upgrades we expect to lower the transaction fee from 30% to 75% and speed up block validation up to 2 times. Another fundamental upgrade is implementation of Typescript – it’s a programming language created by Microsoft as side-language of JavaScript. With Typescript Bitcoin could be optimized even further and developers will be able to detect even more possible errors during code compiling. These 3 major upgrades Schnorr, Taproot and Tapscript will bring smart contract to Bitcoin’s base layer. We can easily say that soft-fork of this caliber will be one of the most innovative additions to the Bitcoin protocol up this date. So far we don’t have definitive date set for Bitcoin soft-fork, it’s expected to happen in Q4 of 2020.

Lightning Network and other side chains evolution

In addition to the basic Bitcoin protocol, other layers are also developed. The main secondary layer is undoubtedly the Lightning Network. It is used as a solution to process faster, cheaper micropayments. In the past we could see that sharp price rise of BTC caused transaction fee to rise dramatically and led to a situation where the costs of small transactions exceeded their nominal value.

Large portion of Bitcoin network developers believe that innovations such as Lightning Network and other sidechains and will eventually make Bitcoin excel in the micropayment area, niche so far reserved for altcoins.

Cryptocurrency and Influx of Institutional Investors

So far institutional investors couldn’t really invest in cryptocurrency, mostly because blockchain-type of assets for the most part are still unregulated. This situation is quickly changing, the inflow of institutional resources into crypto sphere may prove to be the main trend in upcoming years. And while we so far couldn’t establish proper ETF (Exchange-Traded Fund) for Bitcoin, but we have other ways for institutional traders to ender crypto scene, for example  BAKKT or Grayscale investment trusts. Greyscale recently announced revenues of $600 million from new investors, mainly from hedge funds. Various types of research and reports also indicate that financial advisors may increase their clients' asset exposure to Bitcoins and other cryptocurrencies this year.

Bitcoin Halving

Last but not least. Bitcoin Halving is probably one of the most important events in the world of cryptocurrencies – this programmed feature of the Bitcoin network may be a key aspect in evaluating future BTC price and will impact whole cryptocurrency market, not Bitcoin alone. Halving is a cyclical event that occurs approximately every four years. According to data from www.bitcoinblockhalf.com it will take place on May 12, 2020. During halving, the prize for miners who are maintaining BTC, and are ‘digging’ blocks will be reduced by half. Bitcoin is a supply and demand asset an when we reduce the generation rate of new coins demand might follow. Opinions are divided as to how this event will affect the Bitcoin course. Considering the previous halvings, and more precisely what usually happened with the BTC price in an about a year after them, we can expect price increases. Some experts even say that the price of Bitcoin can reach a new All-Time High price. At this point no one knows for sure - only time will tell.

Happy Trading!

If you're looking for general information about cryptocurrency, crypto news, tips, guides, strategies, fintech, new technologies, trading space, crypto investments and many more? MyCointainer Insight is the place to go. We have it covered! Visit MyCointainer Platform also feel free to sign up for our Community so we can make impact together.

Follow MyCointainer on Twitter or Instagram and check out our Telegram channel.