Bitcoin has failed to maintain its upward momentum after a pretty good run in October. Given the rapid decline observed over the past few days, there is a risk that the second to last month of 2019 will become one of the most unsuccessful periods in the entire year for the buyers. In just a month, Bitcoin has lost about 15% of its value and shows the potential for an even bigger decline.
Market participants, traditionally subject to panic moods, predict that the crypto industry’s major asset may face even greater challenges at the end of the year. At the same time, the peak losses are likely to manifest themselves in the first half of 2020, when Bitcoin is expected to undergo its next halving. Apparently, this will be the first time in history when Bitcoin approaches this event in a bearish trend. The upcoming halving event will be the third to date. To recall, every time the reward to Bitcoin miners was cut in half, the BTC received support. The main reason for such dynamics is that miners opted to leave the market since it was no longer profitable to mine new coins due to lower reward.
Normally, when supply in the market decreases, the demand, as well as the prices of related assets, should grow. But that was before. Today, traders are guided by the experience from regular halving events of other currencies, which makes them assume that if the asset does not grow in price in anticipation of the event, the reaction to halving itself will be rather sluggish. Thus, the optimists who were getting ready for another bullish rally in BTC like they saw in 2013 and 2017, should reconsider. Eventually, the long-awaited growth may not follow.
The recent announcement that Google would be joining the financial services industry with its new project code-named Cache could have been another driver for the BTC/USD downtrend. Last Wednesday, the search engine giant announced its plans to launch its own banking service and offer checking accounts, run by Citigroup and a Stanford University credit union. At the first stage, Google Cache users will be able to open and manage their checking accounts via the Google Pay system. Google says it doesn't disclose Google Pay data to third parties or use it for advertising.
Bitcoin sell-off amid this new may be due to the fact that a highly reliable payment service by Google will be another blow to a decentralized Bitcoin, which still doesn’t have a clear legal and regulatory framework. The BTC/USD buyers are currently trying to keep the price above $8,000. Nevertheless, if this support level fails, the negative fundamentals may well be enough for the next bearish rally in the region of $ 7,500.
