Bitcoin Halving (In Just 5 Minutes)
What is Bitcoin Halving?
As we all know, Bitcoins are
the most popularized digital coins flying across the world. Even though it has
created so much awareness among people, the main drawback is its value is
unpredictable and can’t be valued further. Bitcoins are generated by the
bitcoin network every 10 minutes. In 2008, bitcoin came into existence from
then after four years the bitcoins count came to 50 and this is cutoff into
half. This is called Bitcoin
Halving.
After the first halving in 2012 the
bitcoins count was dropped to 25 and after the second halving in 2016 the
bitcoins count was dropped to 12.5. Now, it is estimated that in the third
halving which is yet to be held in 2020 the bitcoins count will drop to
6.25.
Significance of Bitcoin Block Halving
The main objective of halving is to
decrease the count of bitcoins generated per block. This actively ensures that
the count of the bitcoin supply is lower.
When comparing the bitcoin network
with our regular markets, if the supply of a product is decreased the demand
for the same will automatically increase. In the same way, halving will surely
increase the value of the bitcoin.
Bitcoin Halving is scheduled block-wise but not data-wise. On every 210,000 blocks, halving happens. In 2020
halving happens for 630,000 blocks and in 2024 halving happens for 840,000. It
is estimated that in 2020 havling may occur in the month of May and in 2024 it
may occur between March and May. It is powered by blockchain technology.
After the huge process of mining, the miners are rewarded with bitcoins.
Satoshi Nakamoto, the creator of
bitcoin explained that there are only 21 million bitcoins after that bitcoins
will not be mined at any cost. The mining will be desperately stopped in order
to control inflation. But, according to the Bitcoin formula, the maximum
number is 20,999,999,9796 million it will not reach 21 million. It can take a
very long period, maybe till 2140.
Bitcoin Halving Price History
Bitcoin Halving plays a very
crucial role in the bitcoin community. It lowers the bitcoins per block in
order to increase the value of bitcoin and make it scarce like gold. BTC values
after halving are as follows.
2012: The price on the Halving day
was 11$ by the end of the year the price was increased to 1,100$.
2016: The price of the
Halving day was ranging from 500$-800$ by the end of the year the price
was 800$.
By the end of 2017, the price went
on height, it was 20,000$.
There are 32 halvings in total, we
are just done with 2 halvings and the third one is yet to happen soon.
