Bitcoin rose Wednesday following an eagerly awaited adjustment that occurs every few years to limit the amount of virtual currency on the market, building on a recent rally driven by coronavirus.
The so-called “halving” occurs every four years and is when the reward received by “miners,” whose computer processors allow the running of the most popular virtual currency in the world, is reduced.
According to digital currency tracker CoinDesk, the virtual unit traded 1.6 per cent higher at $8,897 in Asia after the “halving” took place earlier this week.
Bitcoin is up about 25 per cent this year, with investors seeing it as a buffer against inflation that central banks are likely to cause to ease monetary policy to protect economies from the virus outbreak.
“The ‘halving’ of Bitcoin in effect makes it twice as hard to generate new Bitcoins,” Jeffrey Halley, OANDA’s senior market analyst, told AFP.
“That will help prices.”
Wednesday’s rise also followed a wider change from stocks to other properties, after a top US scientist cautioned that ending lockdowns too quickly could cause uncontrollable new outbreak of coronavirus.