The world’s most popular cryptocurrency is preparing for a major event affecting its supply and value. The event, known as the Bitcoin Halving, is expected to happen in about 282 days from now, according to a tweet by Glassnode.
Cryptocurrency analytics firm Glassnode recently tweeted predicting the reduction of the Block Subsidy following the Bitcoin Halving:
The countdown til the next #Bitcoin Halving event marches ever closer, now an estimated 282 days away.
— glassnode (@glassnode) July 12, 2023
The upcoming Halving will reduce the Block Subsidy (issuance per block) from 6.25 BTC to 3.125 BTC. pic.twitter.com/xR7onEnwEp
Bitcoin Halving is a process that occurs every four years, or every 210,000 blocks, on the Bitcoin network. It reduces the number of new bitcoins created and awarded to miners for validating transactions. The current block reward is 6.25 bitcoins per block, but after the next halving, it would drop to 3.125 bitcoins per block.
The halving reduces Bitcoin’s inflation rate, making it scarcer and more valuable over time. The halving also increases the cost of mining bitcoins, as miners have to invest more resources to earn less rewards. This creates a supply shock that could drive up the price of bitcoins, as seen in previous halvings.
The first Bitcoin Halving occurred in November 2012, when the block reward was cut from 50 to 25 bitcoins. The second Bitcoin Halving happened in July 2016, when the block reward was cut from 25 to 12.5 bitcoins. In May 2020, the block reward for Bitcoin was reduced from 12.5 to 6.25 bitcoins during the third Bitcoin Halving event.
The effects of the halving are not immediate but gradual and long-term. The price of bitcoin tends to rise before and after the halving as investors anticipate and react to the change in supply. However, other factors, such as market sentiment, regulation, innovation, and competition, also influence the price of Bitcoin.
The next Bitcoin Halving is expected to happen around April or May 2024, depending on the speed of block production. The exact date and time could be tracked on websites such as Bitcoin Clock or Bitcoin Halving. The upcoming halving would also mean that 90% of the total supply of bitcoins, which is 21 million, would have been reached.
The Bitcoin Halving is an important event for anyone interested in cryptocurrency, as it showcases the unique design and value proposition of bitcoin. It also offers an opportunity for investors to speculate on the future price of bitcoin and potentially profit from it. However, as with any investment, risks and uncertainties are involved, so it is advisable to do your own research and be prepared for volatility.
