In May 2020, the bitcoin halving event was considered one of the most anticipated developments in the cryptocurrency space. Bitcoin halving 2020 will help reduce 50% of the subsidy block being given to Bitcoin miners. According to Binance’s blog reported on January 24.
For miners, bitcoin halving seems like bad news. However, many people who closely follow crypto say this phenomenon is the catalyst for a large, positive price action for Bitcoin and altcoins in the future.
How did Bitcoin halving get started?
Those participating in its decentralized network can earn 50 BTC per block when mining Bitcoin since 2018. Bitcoin was created to have a maximum supply of 21 million BTC. If the rate at which BTC were created remained the same, all 21 million BTC would be generated in less than a decade. To ensure that this doesn’t happen, the BTC creation rate was set to drop by 50% after every 210,000 blocks were created. This is what happens with bitcoin mining.
What happened in the past Bitcoin halving events?
The first bitcoin halving event occurred on November 28, 2012. The first 210,000 blocks were created that enabled the code to reduce block rewards from 50 BTC to 25 BTC. Bitcoin halving happened again on July 9, 2016, when the block height of Bitcoin blockchain reached 420,000 blocks. The block reward has since been reduced from 25 BTC to 12.5 BTC. From 2016 to 2020, 2,625 million BTC are expected to be generated.
When will the next Bitcoin halving take place?
Sophisticated calculations and live blockchain statistics to estimate the average block time and other factors affecting the duration of the next halving event. The next Bitcoin halving event is expected to occur on May 6, 2020. However, please note that estimates may change over time.
What can we expect?
When the block height of BTC reaches 630,000, the block reward then decreases from 12.5 BTC to 6.25 BTC. By then, 18,375,000 BTC were circulating, out of a maximum of 21 million. However, from 2020 to 2024, only 1,312,500 BTC will be created.
Why is Bitcoin halving a big deal?
Bitcoin halving affects miners; their rewards will be halved. However, there are many other factors, such as the scarcity of Bitcoin and its underlying impact on the value of cryptocurrencies, market forces affecting the price of Bitcoin, and a number of other external events. Many in the cryptocurrency community believe that halving Bitcoin could trigger a significant rise in the price of Bitcoin.
However, others have said that the event of halving Bitcoin by 2020 cannot be compared with the events of the previous halving, due to a number of factors, such as market growth and better halving predictions in the cryptocurrency community, as well as the possibility that the effect of the halving has been priced into the current BTC price.
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