The price of any commodity tends to gravitate toward the production cost~S.Nakamoto
The argument the halvening will bring great value to bitcoin’s price is for some based on valid logic I think for others a misunderstanding of economics. In other words I think it is somewhat true this halvening will raise bitcoins price, I believe the theory and “belief” by knowledgeable players is that the value of bitcoin in relation to its monetary supply is such that it’s “price” SHOULD rise gradually over time.
That is to say since the markets are well aware of the inflation schedule for all time they are able to immediately adjust to it and so there should not be such an immediate change on the day of halvening. Players in the great game should be able to speculate the increased pressure on the bitcoin’s price and so speculators will begin to buy bitcoin slightly before this event. And so of course some smaller savvy part of the population is expected to invest earlier and so on until present time.
However, in its infancy I think that bitcoin is susceptible to what people will often refer to as types of speculation attacks. In this regard we would be looking at an attack on its price stability (even though stability includes a gradual upward trend). When bitcoin is mature we should expect it to be free from manipulation and hype in this regard. So in the beginning halvenings might likely have a greater effect than the later halvenings in its monetary supply’s life cycle.
This is important in relation to our global financial system as the real price discovery of bitcoin occurs. Again there is optimized theoretical conjectures in regard to optimally decentralized mining pools, fairness and equality in the cost of production, perhaps fungibilty, and other contributing factors that might change or not be ideal for consideration and study in bitcoin’s infancy.
My basic point is that what we are seeing today is a very interesting phenomenon with respect to our national money systems.
As bitcoin’s value in relation to its cost of production is discovered, it must be that any national fiats that take a dive vs bitcoin while other fiats hold steady or a reasonable relation to each other and bitcoin, MUST have lost their quality.
Bitcoin cannot reasonably decrease or increase in value for say a Canadian dollar if the Canadian dollar stays on par with the rest of the world currencies while the world currencies simultaneously stay on par with bitcoin.
As the exchange markets for fiats/bitcoin grow we should expect this phenomenon of the markets highlighting the quality of each currency to grow.
For this observation it seems to be that we are in the infancy, not necessarily of the adoption of bitcoin as a world currency, but rather a new gold-like standard in which all of the national fiats are now necessarily measured in relation to.