What is Halving Bitcoin?
The first thing you need to know is that as part of the Bitcoin coin issue, miners receive a certain amount of bitcoins every time a block is produced (this happens about every 10 minutes).
In the beginnings of bitcoin, miners received a reward of 50 Bitcoin for each block mined. After every 210,000 blocks mined (which occurs approximately every 4 years), the reward per mined block is halved. And again, after another 210,000 blocks it will again halve. This reduction will continue until the mined block reward is 0 (which will occur approximately in the year 2140).
Halving Bitcoin 2020, when is it?
The first halving event occurred on November 29, 2012 at a block height of 210,000 and went on to have a reward of 25 BTC per block mined.
The second halving event occurred on July 10, 2016 at a block height of 420,000 and went on to have a reward of 12.5 BTC per block mined.
And as you can imagine the next halving will occur at the height of the 630,000 block that will be around May 11 – 12.
On the homepage of the bitcoin pizza daythe bitcoin pizza day website you have an accountant with a countdown to the date of the halving. You also have another counter that tells you when the next major event for Bitcoin is going to happen, which is Bitcoin Pizza Day, note miss it.
Why was bitcoin halving designed this way?
Bitcoin was designed as a deflationary currency. Like gold, the premise is that bitcoin issuance will decrease and therefore become a scarcer commodity over time. As bitcoins become scarcer and if demand for them increases over time, Bitcoin can be used as a hedge against inflation as the price, guided by price equilibrium, is bound to rise. On the other hand, fiat currencies (like the US dollar) are inflationary, as their money supply increases, leading to a decrease in purchasing power (in other words, their value is devalued). A simple example would be to compare house prices decades ago, with current prices, you will notice that they have increased over time …
Who controls the Bitcoin issue?
The network itself controls the issuance of Bitcoins, derived by consensus through all Bitcoin participants. Since the beginning of Bitcoin, the following consensus rules have lasted until today:
- 21,000,000 Bitcoins to be produced at most.
- The block interval goal is 10 minutes.
- The halving event that occurs every 210,000 blocks (approximately every 4 years).
- The block reward starts at 50 BTC and is continually halved on each halving “every halving event” until it reaches 0 (approximately by the year 2140).
Any change in these parameters requires that all Bitcoin participants agree by consensus to approve the change.
Will halving affect the price of bitcoin?
That’s the million dollar question … I leave you a graph so you can see what happened with the price in the previous halving and you can draw your own conclusion.
Without a doubt, the halving bitcoin 2020 is another event that will become part of the history of bitcoin. Will the Bitcoin Mosaic project also succeed …?