Bitcoin’s scheduled mining-reward halving in May 2020 could leave prices for the cryptocurrency in a range between $20,000 and $50,000, according to a new estimate.
The projection by Charles Hwang, managing member of the hedge fund Lightning Capital and an adjunct professor at Baruch College, represents a multiple of bitcoin’s current price around $7,500.
Hwang wrote in a post on Medium that he assumed demand holds steady at 633,000 bitcoin through 2021, while mining rewards drop to 328,500 bitcoin a year from the current pace of 657,000 a year.
“This sudden shift in the supply curve will most likely be the catalyst for the next bitcoin bull run,” Hwang wrote in the post.
Lightning Capital is a small hedge fund, with roughly $500,000 of assets, but Hwang’s prediction adds to a growing number of estimates from investors and analysts trying to gauge the potential impact of the halving – where the number of bitcoin mining rewards created every 10 minutes is sliced in half. The cut happens every four years, in accordance with the cryptocurrency’s 11-year-old design.