Bitcoin is about to be halved. What does halving mean? Let us reveal it to you!
In 1924, an ounce of gold was worth $20. Fast forward to 2024, and an ounce of gold is worth $2,380. However, did you know that during this period, the total supply of gold has more than tripled? Every year, gold miners extract an additional 1% to 3% of gold from the Earth's crust. And, given advances in technology, gold mining is only going to accelerate:
Now, imagine that instead of a constantly increasing supply of gold, it was capped because there was simply no more gold to be mined. So, how much is an ounce of gold worth right now? It could be worth hundreds of millions of dollars. This is the same way I view Bitcoin.
Bitcoin Mining Supply Cuts in Half Again When people talk about the “Bitcoin halving,” they’re referring to the halving of the rewards miners receive.
Bitcoin miners have two sources of income:
Block Reward: 6.25 BTC (before halving in April 2024) or 3.125 BTC (after halving). Miners receive this reward to keep the network secure.
Transaction Fees: Miners receive any transaction fees paid by users who process transactions in that block.
An example is a block I picked at random. The miner received 0.725 BTC from transaction fees plus a 6.25 BTC block reward:
This reward, the generation of new BTC, is cut in half every four years, or more precisely, every 210,000 blocks, which takes about 10 minutes each. This is done programmatically and cannot be changed because it is part of the immutable Bitcoin code.
Here’s what Bitcoin supply will look like over the next few years:
2020-2024: 6.25 bitcoins per block, or 900 bitcoins per day;
2024-2028: 3.125 BTC per block, or 450 BTC per day;
2028-2032: 1.5625 new BTC per block, or 225 BTC per day;
2032-2036: 0.78125 BTC per block, or 112.5 BTC per day.
Bitcoin halvings - when the new supply is cut in half - will continue until 2140, when there will be no more Bitcoins to mine and miners will make money only from transaction fees paid by users. So how do Bitcoin miners make money? Transaction fees are expected to exceed block rewards soon, so don't worry, Bitcoin miners won't go bankrupt. The main conclusion is that unlike gold, whose supply increases by 1% to 3% every year, Bitcoin is becoming increasingly scarce!
Let’s take a look at the inflation rate of Bitcoin over the years: 2020 to 2024: BTC inflation rate is 1.8%; 2024 to 2028: BTC inflation rate is 0.83%; 2028 to 2032: BTC inflation rate is 0.4%; 2032 to 2036: BTC inflation rate is 0.2%.
So, as you can see, Bitcoin's inflation rate will be much lower than that of gold. Unlike any other asset in the world, Bitcoin's supply is finite and cannot be changed. It cannot be printed, forged, copied, or increased. This is why people are so excited about the upcoming Bitcoin halving in April 2024.
Bitcoin Halving April 2024 — How High Will BTC Go?
The halving, which is set to take place on April 20, is almost like a religious holiday for Bitcoin enthusiasts. The date marks another four-year period of low inflation.
If you understand economics, when an asset becomes more scarce, the price goes up.
Additionally, since many people believe that Bitcoin halving is good for the value of Bitcoin, they often buy Bitcoin around the halving date, which has historically triggered Bitcoin bull runs with sharp price increases around the halving.
Let’s take a look at the price trend before the halving:
1. First halving (November 28, 2012): Halving price: about $11 Peak price after halving: about $1,150 (November 2013) Increase: more than 10,000%
2. Second halving (July 9, 2016): Halving price: about $650 Peak price after halving: about $19,800 (December 2017) Increase: more than 3,000%
3. The third halving (May 11, 2020): Halving price: about $8,700 Peak price after halving: about $68,700 (November 2021) Increase: more than 600%
4. Fourth halving (April 20, 2024): Halving price: about $65,000 Peak price after halving: ❓ Increase percentage: ❓
Now, fill in the blanks! How far do you think Bitcoin can go? Institutional adoption of Bitcoin and the launch of Bitcoin ETFs are driving demand up, while BTC inflation is even lower. If the predictions come true, we may have another Bitcoin bull run in store!
🤑How high can it go in this 4 year cycle? Who knows?! $100k? $150k? Or will it drop to $20k?
Please don’t treat investing in Bitcoin like playing Russian roulette! Before wrapping up this article, here are 5 cool Bitcoin halving facts 1. The maximum total supply You may have heard of,
1. The maximum total supply of Bitcoin is 21 million BTC. However, this is not entirely accurate. Due to the way the protocol handles decimals, the total number of Bitcoins that will be mined is 20,999,999.9769 BTC.
2. Last Mined Bitcoin Did you know that the last Bitcoin is expected to be mined around 2140, after 33 halvings?
3. Halving The total amount will be halved 33 times before the last Bitcoin is mined.
4. % Mined As of now, 94% of Bitcoin has been mined. In 12 years, 99% of BTC will be mined. 5. In 40 years, only 1.75 BTC will be mined per day (currently 450), with an annual inflation rate of 0.003%.
However, there is more to it than that: Bitcoin is arguably the scarcest asset in the world. It is true that it is in digital form, but it is much scarcer than gold. It is natural to expect that its price will rise faster than gold, which has risen from $20 to $2,350 in the past 100 years. Finally, if you plan to invest in Bitcoin, remember that it is still a volatile asset. #比特币减半 #大盘走势
