Halfway To The Halving: What This Means For Bitcoin
21 Aprile 2022 - 1:00AM
NEWSBTC
Bitcoin halvings are important events that have taken place since
the digital asset was first launched in 2009. Since then, there
have been a total of three halvings that have seen block reward cut
down by half each time. The next bitcoin halving will happen in
2024 which means that the market is halfway there. As this fourth
halving draws close, we take a look at how this affects the supply
of BTC and in turn, the value of the cryptocurrency. Fourth Halving
Coming Up The bitcoin halving is scheduled to happen every 210,000
blocks and the estimate for the next halving is put at May 4th,
2024, going by the current rate at which BTC is being mined.
Currently, there have been a little over 19 million BTC mined,
which only leaves an additional 2 million BTC that is left to be
mined. With the halving cutting block reward by half, presently
sitting at 6.25 BTC per block, it helps to predict the supply
mechanics of the digital asset. Related Reading | New Wallets
Surge On Cardano, What’s Behind This? With each halving, the daily
issuance and supply go down. It is expected to fall even lower with
the next halving, where each block reward would only be 3.125 BTC,
and with the average of 144 blocks that are mined per day, the
daily BTC awarded to miners on a daily basis will fall from 900 to
450. This helps to ensure that the supply of bitcoin diminishes
over time, making it one of the core features of the monetary
policy of the network. How It Impacts Bitcoin The bitcoin halving
has various effects on the cryptocurrency. One of the ways where
these effects are more prominent is mining difficulty. With less
BTC being rewarded to miners for each block, it makes for stiffer
competition, causing mining difficulty to skyrocket. This is
evident in the trend that has followed the last bitcoin halving
which took place in 2020. Likewise, bitcoin’s hashrate also
increases as miners require more computing power to be able to mine
blocks. BTC recovers above $41,000 | Source: BTCUSD on
TradingView.com One notable thing about the current state of the
network is the low fees. Even though bitcoin is halfway to another
halving, transactions fees have remained near all-time lows. This
is said to be the result of more efficient use of block space as
there is no evidence that there is a decline in the economic usage
of the network. Related Reading | Whales Accumulate
Through The Dip As Bitcoin Repositions To $40K However, one thing
has always remained consistent across all bitcoin halvings and that
is the effect it has on the price. Now, halfway through to the next
halvings have been when the digital asset has recorded some of its
lowest prices. So there are expectations that the price will suffer
at this point. Nevertheless, a halving that reduces the supply of
BTC going into circulation has always been a trigger for the next
bull rally and 2024 is expected to be no different. Featured image
from 99Bitcoins, chart from TradingView.com
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