Bitcoin, the first ever invented cryptocurrency, is the most expensive crypto asset currently reigning in the field since its creation in 2009. At the time of its creation, an anonymous creator known by the pseudonym Satoshi Nakamoto was limiting the total supply of Bitcoin. With 21 million tokens. This essentially means that once the number of Bitcoins in supply reaches 21 million, no more Bitcoin tokens will be created. To prevent that from happening, a “Bitcoin halving” process occurs at regular intervals.
The Bitcoin halving process occurs every 210,000 blocks mined on the Bitcoin blockchain. After the halving, the block reward that miners receive will be reduced by half. This reduces the incentive to mine Bitcoin blocks and slows down the addition of new coins to the network. The halving process occurs approximately every three to four years. This is the time it takes for 210,000 blocks to be mined on the Bitcoin blockchain. After Bitcoin was created in 2009, the first halving process occurred in 2012. At that time, the reward for mining Bitcoin increased from 50 BTC to 25 BTC.
In the second and third halving processes that occurred in 2016 and 2020, the BTC mining incentive increased from 25 BTC to the current price of 6.25 BTC. BitPanda tracks Bitcoin halving history.
Currently, the price of Bitcoin is trading at $42,812 (approximately Rs. 35.5 million rupees), and 6.25 BTC is equivalent to $269,465 (approximately Rs. 2 billion), which is the reward amount for Bitcoin miners. As specified in the coding compiled by Satoshi Nakamoto, the Bitcoin halving event is scheduled to take place only 64 times in total.
Significance of Bitcoin Halving in 2024
With the halving coming in about two months, market analysts are predicting a sharp rise in the price of Bitcoin, which will then lead to interest rate hikes for several other cryptocurrencies. The year following the halving is when BTC will grow the most in terms of value.
By April of this year, the total number of mined Bitcoin blocks is expected to reach 840,000. This could reduce his BTC reward price to miners to his 3.125 BTC or $133,956 (approximately Rs. 1.1 billion).
Bitget said in a recent survey that investors’ expectations for the price of Bitcoin around the fourth halving appear to vary by market. About 53% of global investors expect the price to fluctuate between $30,000 (approx. Rs. 24.8 million) and $60,000 (approx. Rs. 49.7 million), while 30% expect it to breach the $60,000 level. I think so.