Bitcoin Halving 2020: Explanation & Price Prediction

we’re gonna be talking about the Bitcoin having for 2020 which is actually happening in about two days at the time of this recording so the Bitcoin having actually happens once every four years so it’s a pretty important event to talk about and although this isn’t necessarily a crypto channel it’s definitely in the realm of finance and I think it’s an important topic to discuss so I believe it’s good to have a speculative portion of your portfolio in speculative assets Bitcoin being one of them so depending on how young you are you can allocate a little bit more to taking high-risk high-reward positions so in this video we’re gonna talk about the Bitcoin blockchain very briefly Bitcoin mining very briefly bitcoins supply

what is the halving why does it occur and then we’re the million dollar question is actually to be any price predictions that we have after this having of 2020 so without further ado let’s get right into it so what is the Bitcoin blockchain so let’s let’s separate the word Bitcoin for now and just look at the word blockchain blockchain technology is not just specific to Bitcoin blockchain is essentially a decentralized distributed ledger that records the origin of digital assets so what this does is is it basically records in bitcoins case the sender and the receiver and how much money was actually transacted so a ledger is basically just a book of digital transactions if you will so black chain technology will actually be used and it will probably be as ubiquitous as email is today so if you remember those old news channels or those new news videos saying someone sent mail digitally through email will this ever catch on live at six you know and now it’s everyone uses email I guarantee you everyone watching this video has sent or received an email that’s most likely what blockchain will become five to ten years from now so in bitcoins case as I mentioned you have someone who is a sender a receiver and the amount listed which then fills up these blocks with information of these transactions so these blocks are basically transactions grouped together and they

only store a maximum amount of info which then has to be verified a chain is created and then you have a next block that comes after it which fills up with more info so there’s a network of computers all around the world that verifies these transactions and they do that through mining so if you’re still with me let’s go to Bitcoin mining okay so very quickly let’s talk about Bitcoin mining if you’re already familiar with how this works skip to the next section if not very quickly Bitcoin mining is basically how those blocks and those transactions get verified so we don’t have people literally mining like you would mine gold or silver you’re basically using computing power to verify those transactions

okay so miners are people or groups of people at this point just because it’s gotten so hard to mine on your own that use basically computing power to maintain that ledger and verify those blocks keeping the information clean so think of these miners as basically auditors or accountants that keep the blockchain clean and verified so you can verify the sender the receiver and the amount sent or received

so basically miners receive Bitcoin plus fees as an incentive to keep mining aka to keep verifying all these transactions aka to keep the network clean so they receive a little bit of fees from the transaction and right now they’re typically receiving 12.5 Bitcoin for every block that’s verified so now that we’ve talked about the Bitcoin blockchain and the Bitcoin mining process very briefly to establish just some sort of foundation if you’re not familiar let’s talk about the Bitcoin supply

so very quickly Bitcoin was created by Satoshi Nakamoto in 2009 and Satoshi is not a real person that is just a pseudonym that a computer programmer went by it could be an individual male female could be a group of people could be a government agency no one really knows who created Bitcoin however it did start in 2009 after the financial crisis so this person whoever this programmer was they designed Bitcoin to mirror the characteristics of gold yes gold the precious metal is what I’m talking about so just like Bitcoin mining gold takes effort you have to set up the mine you have

set up the people you have to set up the equipment you don’t just you know click a button and print trillions of dollars overnight like we have been over the past few months and just like gold Bitcoin takes computer power and it takes time and effort to mine these Bitcoin so this makes Bitcoin and gold a very hard money as opposed to being a soft money and I’m not going to go into much detail in that video about the characteristics of money you can see those videos here so there’s only ever gonna be a maximum supply of 21 million Bitcoin ever to be minted or brought into circulation and we have about 18 million of those in circulation right now so the reason for this is because the Satoshi wanted to create a money that is deflationary because there is a fixed amount so this means that over time bitcoins purchasing power will actually increase instead of decrease so fiat the u.s. dollar is actually an inflationary currency so here’s an example in 1940 a gallon of milk costs roughly 52 cents a gallon in 2020 it costs two dollars and seventy five cents that’s what we call inflation so a lot of people they don’t understand that if they’re saving money in a savings account that actually is an interest rate lower than the rate of inflation they’re actually losing money making savers losers there I said it again oh my god

so let’s get into the next section of what actually is the halving and some price predictions so what is the halving that’s happening in the next couple of days here the halving is essentially just the reduction in block rewards by 50% so if you remember earlier in the video I explained how the miners are rewarded 12.5 Bitcoin plus fees every time they verify a block and verify all that data and create a new hash essentially that is gonna be dropped by 50% so right now they’re earning 12.5 that’s gonna be dropped to six point two five so essentially every happening well the joke is it’s called a happening so that every having happens every two hundred and ten thousand blocks one block takes about 10 minutes to verify and if you do all the math that actually comes out to be three point nine nine years so you can see here in 2009 you rewarded 50 Bitcoin per block than 25 and

12.5 and now in 2020 it’s going to be 6.25 moving forward so in 2024 leave a comment down below what the half of 6.25 is if you’re still watching at this point so why does the halving occur why did Satoshi Nakamoto even bother to program this feature into Bitcoin well basically it prevents inflation which will ultimately decrease purchasing power so going back to that milk in 1940 how is 52 cents a gallon and in 2020 it’s roughly 275 that’s what bitcoin is trying to prevent it’s a deflationary asset or deflationary money so you can’t just print Bitcoin overnight and especially trillions of it like you can with the US dollar it needs to be halved every 210 thousand blocks to prevent that from happening he or she Satoshi Nakamoto or them actually understood that technology improves over time meaning that miners would be able to verify more blocks faster which would ultimately increase the supply of Bitcoin much more quickly than it can now so here’s an example right now there’s about 1800 Bitcoin that are mined daily which results in an inflation rate of about 3.8 percent after this having occurring that’s gonna go down to about 900 Bitcoin daily which actually brings it down to 1.9 percent which is actually lower than the US economy so this controls circulation of money over time unlike the amount of money that were essentially just printing in this time period right now so on to the next and final slide and probably what you all came for cuz you’re all greedy and you know impatient and price predictions let’s get into preys predictions right now okay so finally the slide you’ve all been waiting for let’s get some price predictions out here so a bitcoin after looking at all the research and all the macro charts and all the historical charts that have happened after each havening or having whatever you want to call it bitcoin typically hits a new all-time high within one and a half years after each having so check out this chart right here so you can see in this chart here that the first having block reward went from 50 to 25 that’s the first orange line in the chart that was November of 2012 and Bitcoin basically skyrocketed then went sideways and skyrocket

again and then for the next two and a half to three years to the next having where the block reward went from twenty five to twelve and a half is actually pretty much sideways or down then it skyrockets again after about a year and a half and then it went sideways to down up until 2020 which is where we’re at right now and this is where I kind of predict where it’s gonna do the same thing it’ll probably go down go sideways get manipulated by institutional investors and then once the next having comes where the block reward goes from 6.25 in half which were you answer it in the comment section down below it’ll probably skyrocket after that again so some people are actually saying that the peak is going to be in August of 2021 where the price of one Bitcoin is five hundred thirty three thousand four hundred and thirty one dollars some people are saying hundred thousand dollars some people are saying zero what do I think so me I’m not a Bitcoin expert I’m just someone who holds it as a speculative part of their portfolio and a small percentage of my overall net worth and I think it’s going to do what the chart just said it’s probably gonna fall it’s probably gonna decline it’s probably get manipulated it’s probably gonna get made fun of someone’s gonna leave some stupid comment in the comment section down below and then I’ll be laughing at them about 48 months later so if you want to buy Bitcoin check out the referral link below yes that’s an affiliate link I get $10 when you sign up you get $10 when you sign up it’s a win-win or you can meet me in person buy me a beer

it’s a PG channel now some sixth grade teacher told me their sixth graders watch this channel so don’t buy me a beer buy me a Shirley Temple or a virgin daiquiri as always I hope you got value out of this video please share it with one crypto friend or crypto fanatic and I look to see look forward to seeing you in the next video this is a very long awkward outro and if you’re still watching you’re the real MVP thank you so much and have a prosperous day so the pandemic is obviously affecting a lot of industries right now

and everyone’s talking about the stimulus package and stocks and cruise lines and all that stuff which is great however not many people are making videos about the potential recession in the car

industry so production is shut down factories are shut down

supply chains are being disrupted and obviously there’s lower demand with the quarantine going on right now

so in this video we’re going to talk about the state of the industry we’re going to talk about how we can benefit as consumers and buying a used car

and we’re also going to talk about how we can benefit with certain incentives going on with new cars

stay tuned so let’s talk about the state of the automotive industry

everyone knows that new cars are getting more and more expensive and it’s not feasible for the average middle class person to be buying brand new cars so more people are leaning towards used so when it comes to used cars

dealers know that this is going to be a huge profit center for them

used cars typically have higher margins and bigger profit margins than new cars because you can only relatively sell a new car within a certain price range without having to take a loss

new cars are sometimes even the biggest lost leaders at a dealership

just to get that customer to go to service financing etc etc

so think about it this way when you’re going shopping for a gallon of milk and you go to one grocery store

and the gallon of milk is priced at x you go down the street

the other gallon of milk is probably going to be very similar however used cars are different

the dealer is taking in these used cars at different prices and at much lower prices typically wholesale

and they’re marking them up and selling them to the customer at retail or what market price

is so where do these used cars originate as mentioned

they come in from trade-ins so when someone goes to the dealership they want to get rid of their old car and buy a new one

they typically don’t want the hassle of selling it privately so they just trade it in

they’re coming in from auctions which is typically wholesale pricing

they’re coming in from rental companies that are selling their current fleet and they’re coming in from lease returns people that don’t want to purchase their lease and just want to go back into a new lease or a different vehicle they return the lease the dealer cleans it up sells it as a used car on the lot however the issue in the crux of this whole video is that used car sales are plummeting

according to mannheim’s used prices they are down 11.8 percent in the first half of april

used car auctions are having prices fall significantly because people are simply not going to them

and supply is outpacing demand by a lot so use car prices plummeting creates pressure on the automotive industry in four different ways

the first way is that new car prices have to either be discounted heavily in order for new inventory to come in so if a dealer is sitting on 2020 models or potentially even 2019 models that still

haven’t moved they need to make room on their lot for 2021 models

so they have two ways of doing this by offering crazy incentives which we’re going to talk about at the end of this video

or by discounting the msrp pretty significantly

the second way it’s creating pressure is re is on rental companies

so rental car companies they sell their used fleet

to the public or to wholesale pricing after they’re done

renting that car out so they can’t offload their inventory at the price that they expected because the used car market is going down so much

which is creating tons of losses in that industry

so if you’re following this video at the time of the recording hertz is actually fighting bankruptcy at the time of this recording

and they may potentially go bankrupt check out their stock if you want to look into potentially investing in that i probably wouldn’t touch it right now but it could be a good opportunity the third way it’s creating pressure is through lease residual values

so if you don’t know what a lease residual value is residual value is basically just what the car will be worth at the end of a lease so these car companies

they have depreciation charts they know exactly what they think the car will be worth at the end of the three year lease however they didn’t expect there to be a quarantine and use prices to be discounted so much so just to give you some perspective

gm is sitting on 30.4 billion dollars worth of lease cars

and those have an expected certain value however that’s going to cause

potentially

billions of losses if those cars are sold

significantly under residual value same thing with ford

ford has 27.6 billion dollars worth of leases on the road right now from last year

so as mentioned those financing arms are expected to incur

billions of dollars of losses and then the fourth way that the used car prices declining or affecting the automotive industry is obviously through dealership earnings

so dealer earnings make so much money on new cars

sometimes it’s a loss leader it’s just to acquire the customer into service and financing and warranties

however there is still sometimes profit made on new cars although the margin is very small

however this is still going to affect dealership earnings

so the next part of the video is talking about how to buy a used car

especially during this time right now a lot of people are reaching out to me on instagram on how to buy a used car during this specific time

and i can’t get back to every single person on instagram or on twitter so i decided to dedicate a whole section of this video

so pay attention so demand is obviously low right now people aren’t necessarily you know jumping out of bed at nine in the morning saying hey honey let’s go to the dealership you know i want to get you know the corona that’s terrible i shouldn’t even joke around about this but demand is low okay so we are in the driver’s seat

terrible pun edit that out no i’ll just keep it in

so we’re in the driver’s seat as the consumer meaning that

they need to sell a car more than we need to buy one okay

so what you want to do is you want to go on a website where it shows you how long the car has been on their inventory or on their lot

so you may want to check out

cargurus.com i’m not affiliated with them i’ve just used it as a consumer for many years

and if you scroll down you can actually see the price history of the car how long they’ve had it and how much it’s been discounted so the longer a car sits on a lot that means the more the dealership is paying an interest in terms of financing that car meaning they’re accruing interest and losing profit so they got to move this inventory otherwise it’s going to go to auction

but wait auctions are actually getting crushed right now because inventory is outpacing demand so that’s your first um advantage to dealing in this environment

the second is this one you already know whether it’s during the pandemic or not be prepared to walk away so if they want to sell you the car

great you know if not no big deal walk away if they really want to sell you the car

they’ll call you back a day or two later and say hey marco we know you’re looking at this you know car

we’re going to discount it another blank will that work out for you and that’s when you can start to negotiate number three is you want to line up your financing before you get to the dealership

that way you know going in what your budget and what your payment is going to be and what your apr or your interest rate is

if the dealer can beat it with their financing great go ahead and take it if not

use yours but you never want to be pressured into a deal that you don’t want to take

and then number four don’t trade in your car during this time

there is no incentive for dealerships to take in your car at a reasonable price or reasonable value because they’re sitting on so much inventory anyway

that they’re gonna low ball the heck out of you okay so don’t trade in your car what i would recommend doing is selling it privately

there’s a million different websites you can do it and guess what i’ve

i’ve bought and sold a million cars on craigslist and i’m still in one piece i haven’t been chopped up or thrown into a freezer or trunk okay

it’s not as bad as everyone makes it out to be so if if a used car is not for you let’s check out some of the new car deals that are going on

right now so if you are in the market for a new car and you decided that going used is not for you

there’s a lot of incentives going on right now in terms of new car deals do i recommend buying a new car probably not usually financially it doesn’t make sense because of the depreciation hit you take

driving right off the lot typically you’re going to lose about 30

just within the first couple of years however there are a lot of incentives going on right now

so the biggest thing that i’m noticing is that a lot of financial arms of these car manufacturers are creating incentives in terms of payment deferrals and also grants

so what do i mean by this so for example i’m going to list off about

seven or eight here just to give you an idea although i will link to a car and driver

article down below it has incentives from all the major manufacturers so ford is actually offering to make your first three payments

like literally just make your payments for you so if your payment’s 400 bucks you have 1200

right there for the first three months and then they’re gonna defer your payments for the next three months so meaning for the first six months you basically have no car payment okay although you do owe the last three fiat chrysler

don’t know anyone that would want to buy and voluntarily buy a fiat or chrysler product

other than maybe a jeep or a dodge ram but they’re actually offering uh 84 months at zero percent financing so the thing with zero percent financing is is that

yes you’re not paying interest on it and it basically is quote unquote free money but you’re obviously going to be paying a higher amount for the price of the car so if it makes sense for you you may want to put a little bit of money down finance that sucker out for you know seven eight years and there you go although i don’t recommend that whatsoever if you can make more money somewhere else than zero percent then mathematically it does make sense uh genesis is actually offering six months of payments uh they’re going to take care of it for you if you dig it laid off or lose your job during covid oh i just said covet ah videos monetize no

share the video with a friend it’s already the amount of time

i’m just kidding so if you lose your job and a couple other manufacturers are using this as well

if you lose your job due to the pandemic or during the pandemic

they will make up to six months of payments for you and they’re also offering zero percent financing on their g70 product

which after watching a bunch of reviews actually is a pretty decent car gm zero percent 84 months honda 1000 bucks towards the purchase of a new car and three months of payment deferral hyundai six months that will pay for job loss i mean genesis is hyundai so it’s the same thing

also with zero percent financing available kia

75 months zero percent and volkswagen actually sounds like it has the best one they’re gonna defer payments for six months and you’re gonna get zero percent interest for up to 72 months

so do i recommend buying a new car i don’t know if the depreciation and the zero percent financing and you being able to invest that money and and something else that makes you more than zero percent actually preferably something that makes more than inflation

two to two and a half percent then i say go for it

but however you have to take the depreciation into account if this is a car you’re gonna keep forever until the wheels fall off

sometimes buying new does make sense although most of the time i am against it

so i hope this video brought you value i hope you didn’t get laid off during this time

however if you are in the market for a car or if you know someone that is please share this video on social media it greatly helps me when you do that and also give the video a thumbs up thank you so much and as always have a prosperous day bro fiat chrysler how are they still in business.

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