With the fourth Bitcoin halving being in the spotlight – occurring near the end of April 2024 – everybody is wondering how it is going to impact the price of Bitcoin and whether it will have long-term effects on the value of the ever-so-popular cryptocurrency. Analysts, investors, Bitcoin miners, crypto owners as well as businesses leveraging cryptocurrencies, including online gambling sites such as casino PH platforms as well as other enterprises, are now waiting to see how prices are going to be shaped and accordingly tune their decisions and strategies to take advantage of opportunities.
Bitcoin halving is not an emergent process.
Bitcoin halving is not an emergent process. It is a scheduled process, through which the creation of new Bitcoins is controlled. Now, in case you are asking why should the supply be controlled, just think that back in 2009 when Bitcoin was first introduced, there was a predetermined amount of cryptos to be rolled out into the market. 21million BTC were to be circulated in the crypto ecosystem. This was, in fact, a built-in mechanism to make sure that the cryptocurrency would retain value and scarcity, unlike fiat currencies whose value is largely controlled by their supply, which is managed by central banks.
Halving was encrypted in the Bitcoin from the beginning of its launch and it has been programmed to occur approximately every four years. Now, if you are wondering what exactly halving is let’s see how it works and you’ll get a pretty good idea of that.
Bitcoin halving essentially cuts the creation of new bitcoins in half. As of March 2024, more than 19.5million BTC had been mined, which leaves us with some less than 1.5million bitcoins left up until we reach the capped 2.1million. So halving is the process of stalling the progressive launch of new bitcoins in order to delay the upper limit, which was established from the very beginning. Halving has already occurred three times before that of April 2024. The first was in November 2012, the second was in July 2016 and the third one was in May 2020. It is estimated that the last Bitcoin halving is going to occur in 2140!
Now, what exactly does halving do?
New bitcoins are rewarded to miners, who are responsible for adding transactions to the blockchain by solving extremely complex algorithmic and mathematical formulas. On the launch of the cryptocurrency, miners were awarded 50BTC, which became 25BTC in the first halving, 12.5BTC in the second halving, 6.25 in the third, and 3.125 in the fourth. By cutting the awarded new bitcoins, the supply of BTC gets to be more limited.
Now, if everything else stays put, the reduction of supply will cause the price to increase. Demand will stay the same -or maybe it will go up, and given the slowing down of bitcoin circulation, the price will go up. So, essentially, halving becomes the means to promote value growth, scarcity, and long-term uprising demand for cryptos.
Theoretically, Bitcoin halving will make all those people who own cryptos gain greater value, those who have Bitcoin reserves possibly try to sell them to leverage greater prices, and those who use cryptos for any purpose, from purchasing products to casino games or sports betting on platforms like BK8, try to gain from the upwarding prices.
Even though there is no conclusive evidence as to how the price of Bitcoin behaves after the halving, experts and analysts suggest that it will be a really rewarding thing. The previous halvings have caused Bitcoin prices to go up, but there is no empirical support for the direct correlation – in 2020 for example the price went up, but it is considered to be largely due to the pandemic and in 2016 the price also went up, but it plunged a bit later.
Bitcoin halving is considered to be a thrilling thing by many people who are involved in the broader crypto ecosystem, but it has been triggering doubts and concerns to a lot of people who are challenging this process as an appropriate one to promote value and retain scarcity. For the rest of us, it remains to be seen!
