What Is the Bitcoin Halving? How Bitcoin’s Supply Is Limited

Others caution that reduced mining activity due to lower rewards might cause the price to level off. Bitcoin halving is a pre-programmed event that occurs approximately every four years, reducing the block reward for miners by half. This mechanism reduces the rate at which new Bitcoin’s enter the circulating supply. While the excessive ‘money printing’ was a short-term measure to keep the global economy from collapsing, it was not without long-term effects. High inflation, driven by the increase in the supply of fiat currency, has impacted many economies around the world and has caused a rapid increase in the cost of living for people globally.

What Time is Bitcoin Halving 2024?

Higher prices would be an incentive for miners to keep processing Bitcoin transactions. The event occurred almost a month after BTC hit an all-time high of $73,750 on Mar. 14, 2024. Presently, more than 19 million Bitcoins have already been mined, leaving under 2 million left to be created. The Bitcoin protocol periodically reduces the number of new coins earned by miners in a process called halving. For miners, the halving event may result in consolidation in their ranks as individual miners and small outfits drop out of the mining ecosystem or are taken over by larger players.

How We Make Money

• The recent price performance might be disappointing for some, but the halving remains a significant event in Bitcoin’s overall narrative of controlled issuance and potential long-term value.
• This can include everything from non-fungible tokens (NFTs) to decentralized finance (DeFi) exchanges, all of which are built on top of the Ethereum blockchain.
• By slowing the pace, the basic idea is that the scarcity of bitcoin tokens will increase.
• The bitcoin protocol periodically reduces the number of new coins earned by miners in a process called halving.
• The second halving saw Bitcoin rise from $US650 to almost $US20,000 in 2017 and the third from $US8,500 in 2020 to over $US65,000 in late 2021.

A Bitcoin halving cuts the rate at which new Bitcoins are released into circulation in half. The rewards system is expected to continue until 2140, when the proposed limit of 21 million bitcoin is theoretically reached. The Bitcoin Halving is intended to counter any inflationary What is Bitcoin Halving effects on Bitcoin by lowering the reward amount and maintaining scarcity. However, this inflation “protection” mechanism does not protect Bitcoin users from the inflationary effects of the fiat currency to which it must be converted to be used in an economy.

About the Bitcoin network

• Built mainly for gaming applications, these GPUs were repurposed to perform various mathematical computations needed for mining BTC.
• So it’s now only a matter of time before investor money starts to flow into these ETFs, helping to push up the price of Ethereum.
• The Bitcoin network is based on blockchain technology, which is comprised of a decentralized and distributed network of nodes.
• The price surge caused by the ETF approval along with anticipation for the halving itself could be a key reason why Bitcoin hasn’t experienced the dramatic moonshot many expected.
• The future price of bitcoin is likely to continue fluctuating as cryptocurrency value can be volatile and speculative as an investment instrument.
• But rising interest rates cooled investor enthusiasm in 2022, with a flight away from riskier assets like cryptocurrency.

These proactive measures indicate that Bitcoin miners are equipped to handle the upcoming changes, at least in the short term. Approximately every four years, after the mining of 210,000 blocks, the block reward granted to miners for processing Bitransactions undergoes a halving. This reduction, programmed into the Bitcoin protocol, serves to gradually decrease the rate of new Bitcoin issuance, thereby contributing to its deflationary nature.

If I Own Bitcoin, Will Anything Change for Me After the Halving?