No Result
View All Result
Advertise
Submit a Press Release
Contact Us
Coindoo
  • Cryptocurrency News
    • All
    • Bitcoin News
    • Cardano News
    • Ethereum News
    • IOTA News
    • Litecoin News
    • Ripple News
    • TRON News
    XRP price prediction

    Ripple (XRP) Price Prediction and Analysis in January 2021

    PayPal

    PayPal Plans to Perform Crypto Transactions | Will It Get Bitcoin to $15.000?

    Sports News Apps

    The Best Classic Sports News Apps to Keep You Up-To-Date

    wire act

    What the Wire Act Means for Cryptocurrency

    cryptocurrency apps

    Cryptocurrency Apps Every Trader Should Have in 2020

    BitFlyer Brave

    Japan’s Biggest Crypto Exchange Partners with Brave to Launch Wallet

    Trending Tags

    • ethereum
    • ripple
    • Tron
    • bitcoin
  • Analyzes & Reviews
  • Guides & Tutorials
    Bitcoin casinos

    Most Common Coins Used to Play at Bitcoin Casinos

    crypto casinos

    Was 2020 the Year of Crypto Casinos?

    crypto signals

    How to Use Crypto Signals to Earn Money?

    online

    The Best Cryptocurrencies You Can Play in Online Casinos

  • Events
No Result
View All Result
Coindoo
No Result
View All Result
Home Blockchain & Crypto Events

5 Facts About Bitcoin Halving Every Digital Asset Investor Should Know

Anca F. by Anca F.
May 14, 2020
in Blockchain & Crypto Events

The Bitcoin halving happened this Monday, May 11th, and the crypto community is in a frenzy. Here are 5 facts every digital asset investor should know about the Bitcoin halving.

The Mining Reward Is Now 6.25 BTC

Bitcoin mining
which.co

A halving is a programmed update to the underlying network which manages the supply of all new Bitcoin. The miners of the network use their computing resources to find solutions to the complex math problems in order to validate Bitcoin transactions. The miner who first finds the solution to the algorithm gets the block reward, i.e., the bitcoins in the new block that has been validated.

As it is implied by the name, the halving reduces the number of Bitcoins per each block mined by half. Up until this Monday, the block reward was 12.5 BTC, but now, up until sometime in 2024, Bitcoin miners will get 6.25 BTC for every block they mine.

It Regulates the Supply

The supply of Bitcoin is controlled by its underlying protocol, and this mathematical function is scheduled to reduce the Bitcoin production number by two, almost every 4 years or every 210.000 blocks.

In 2009, the reward was initially 50 Bitcoins per block, and, during the first four years, 10.500.000 Bitcoins were generated. After another 4 years, the block was down to 25, and 5.250.000 Bitcoins were generated in that period.

During the third period prior to the halving, 2.625.000 Bitcoins were mined, totaling a circulation supply of 18.375.000 Bitcoins. The rest of the 2.638.700 Bitcoins will be generated in the next 100 years.

In Each of Its Halvings Bitcoin Generated Earnings of 12,000%-13,000%

bitcoin earnings
inspirationfeed.com

The price of Bitcoin has been impacted differently by each of its halvings because of the reduction in supply, generating huge revenues for every digital asset investor that bought the coin early on. After the first halving on 12 November 2012, it took 513 days for bitcoin to shoot up from $12 to $270 in April of the following year, marking an increase of 13,304%. 524 days after the 2nd halving on 16th June 2016, the coin went from $696 to nearly $20.000, which meant an increase of 3.200%. It took BTC 1068 days to increase with 12,168% from its second pre-Halving bottom of $164.01 to its post-Halving high of $20,074.04.

We can notice that from the lowest pre-halving value to the highest post-halving value, there has been an increase of approximately 12,000–13,000% in both cases.

But the main difference is that the second time it took Bitcoin twice as long to rally the same percentage. From this, it is expected that after the third halving, it will take much longer to notice the same percentage of gains if the same pattern is to be followed.

Even though there is always a bull rally a few months prior to the halving event, immediately, a correction occurs. In the previous two halvings, Bitcoin’s price also rallied and slumped afterward.

There is always a period of accumulation after a bear market, which is then followed by a period of expansion in price. In 2019, the bear period occurred between December and March 2019, and then the expansion period occurred between March and June, with the price of BTC surging from $5000 to $13,750.

After the expansion phase, there is another accumulation period, which is a sign of a bull market.

As a digital asset investor, monitoring the price of bitcoin and its possible long-term evolution is essential, as it also impacts the rest of the altcoin market.

Mining Impacted, but Miners Planned in Advance

It is obvious that miners and mining will be the ones directly impacted by the halving. As a consequence, the hash rate that keeps the network secure and the transactions validated will also be impacted. Miners will experience a sharp decrease in profits if the price per Bitcoin doesn’t increase. If they mine at the same difficulty as now, they will spend the same money on computing one block but get fewer Bitcoins, which means less profit.

In past instances, the price of Bitcoin adjusted itself; only the process was not immediate. As miners will be less motivated to mine new blocks while the price of Bitcoin reaches this equilibrium, the hash rate will also decrease.

However, most mining is now operated by large organizations that have taken the necessary precautions and investments in their mining infrastructure, anticipating this decrease.

After the first halving, the Bitcoin hash rate dropped with 34% in just a few days, but then, on Feb 17 2013, the hash rate reached 29 TH/s months later after the event.

The second halving didn’t impact Bitcoin’s hash rate as much, with miners being able to mitigate the reduction, as the price of BTC was slowly rising during that time.

If the network difficulty stays the same, and Bitcoin’s price goes up, miners are expected to stay on the network and keep the same hash rate. With higher prices, new miners might be motivated to enter the network.

There Are Actually Less than 21M BTC

bitcoin image
coindesk.com

The 21 million Bitcoin limit is not an exact number, but a limit determined by mathematical rules. By these algorithms, it is anticipated that the last Bitcoin will be mined on October 8th, 2140. The actual supply of Bitcoins that can be spent is actually lower than the limit rule itself, with the actual number being slightly below 21 million.

Bitcoins can be rendered unspendable through various methods, such as losing the private keys to a bitcoin wallet or losing the hardware wallet in which they were stored. Bitcoin can also be lost by sending them to addresses that are not valid.

Conclusion

Without a doubt, the bitcoin halving is one of the most important events in the coin’s and crypto market’s history, and as such, every digital asset investor, regardless of the coins he has in his portfolio, should be aware of its impact and consequences.

Featured image: medium.com

Tags: bitcoin halvingdigital asset investorimpact btc halvinginvestor BTC halvingreward block halving
Anca F.

Anca F.

Related Posts

cryptos to buy

Top 5 Explosive Cryptos to Buy After the Third Bitcoin Halving

by Tony P.
June 17, 2020
0

The third Bitcoin halving took place in May 2020. But before we delve into the cryptos to buy after the...

bitcoin halving

Is BTC Mining Still Profitable After the Third Bitcoin Halving?

by Anca F.
May 28, 2020
0

On May 11, the Bitcoin network went through its third halving, reducing the block reward from 12.5 BTC to 6.25...

bitcoin price prediction

Bitcoin (BTC) Price Prediction and Analysis in June 2020

by Anca F.
May 20, 2020
0

We will be looking at the BTC price history and market predictions in order to try and formulate a Bitcoin...

Bitcoin

Join FreeBitcoin’s Bitcoin Halving Party on 17th May

by Ionela C.
May 18, 2020
0

At 7:23 p.m. UTC, on Monday, 11th May 2020, the crypto-community got what it was waiting for. The highly-anticipated Bitcoin...

Bitcoin halving

The Bitcoin Halving Has Finally Happened: What Does It Mean?

by Anca F.
May 12, 2020
0

Finally, the most awaited event in the crypto industry of this year has happened: Bitcoin has halved! But what does...

Load More

We Recommend

Top Rated Casinos
Bitstarz Casino

CryptoGames

1xBit Casino

Winz.io Casino

BitcoinCasino.io
Top Crypto Prices Provider
Crypto.com
Top Crypto Trading Bots
TradeSanta
Top Rated Exchanges
Crypto.com

Binance Exchange
Top DEFI Leaderboard
Crypto.com
Top Advertising Services
Coinzilla Display Network
Our Latest Reviews
coinbase review

Coinbase Exchange Review

Even if it has its flaws and controversies, Coinbase is a
Kraken exchange review

Kraken Exchange Review

The exchange is one of the most popular crypto trading platforms,
XRP.io wallet review

XRP.io Wallet

XRP.io provides a very easy to use and simple user experience.
View All Reviews

Editor's Choice

Blockchain Analyzes & Reviews

CoinRabbit Review: How to Profit From Hodling Your Crypto?

by Ionela C.
January 13, 2021
0

SwapSpace exchange aggregator

SwapSpace Exchange Aggregator Review: Supported Cryptos, Fees, Pros and Cons

trading

The Benefits of Cross-Chain Trading

August 28, 2020
Stratus

Stratus Redefining Social Media

August 24, 2020

5 Minutes of Blockchain & Cryptocurrency News!

We completely understand that your inbox is already full of junk emails. We promise that we gonna try to keep it clean by sending a daily newsletter with our latest news. You can always choose to unsubscribe to our newsletter if you're not satisfied.
coindoo icon
  • Contact Us
  • Advertise
  • RSS Feed
  • About Us
  • Partners
  • Terms & Conditions
  • Privacy Policy

© 2017-2020 Coindoo

The information on this website and the links provided are for general information only and should not constitute any financial or investment advice. We strongly recommend you to conduct your own research or consult a qualified investment advisor before making any financial decisions. We are not responsible for any loss caused by any information provided directly or indirectly on this website.

No Result
View All Result
  • Cryptocurrency News
  • Analyzes & Reviews
  • Guides & Tutorials
  • Events

© 2017-2019 Coindoo