Why Is Bitcoin (BTC) Price Rallying in 2020? Brian Kelly Names Three Main Reasons

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Sun, 02/16/2020 - 09:57
Alex Dovbnya
CNBC's Brian Kelly names three major reasons to explain why the Bitcoin (BTC) price is on a tear this year
Cover image via www.cnbc.com
Contents

BKCM CEO and CNBC contributor Brian Kelly recently appeared on 'Fast Money' to discuss Bitcoin's latest price rally. During his conversation with the show's host Brian Sullivan and other traders, he named three reasons why the "big yellow coin" has so far rallied by more than 44 percent this year.

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Miners are about to be paid less

Kelly reiterated that Bitcoin (BTC) was surging higher because of the upcoming halving event. At the end of April, the reward for mining is going to be cut in half from 12.5 BTC to just 6.25 BTC. If the coin's price remains at the same level of roughly $10,000, miners will only make $62,500 per block. 

"Miners have stopped selling their inventory because they want higher prices. They are expecting higher prices."  

While it's logical to assume that this supply reduction has been already priced its, it wasn't the case during the two previous cycles. 

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Adoption is growing 

Kelly also named the growing institutional adoption as one of the causes of this bullish momentum. Bitcoin is now recognized as a safe-haven asset that can be viewed as a digital alternative to gold. 

As reported by U.Today, there was also an uptick in newly addresses, which means that BTC's fundamentals are now catching up with its price action. 

"When you see daily active users or addresses growing, that means that fundamentals are improving."  

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Altcoins could continue rallying

Kelly also expects Ethereum (ETH) and other smart contract-based platforms to continue performing well this year. Earlier this week, analyst Edward Moya predicted that positive momentum could push the ETH price to $440.  

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.

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