Bitcoin 2024: Halving is approaching, a decisive turning point for cryptocurrency


In a few days, the community of Bitcoin miners and enthusiasts is preparing to experience a crucial event: the halving. Scheduled for April 19, 2024, this scheduled mechanism halves the reward of miners, a phenomenon that occurs every four years and which has a significant impact on the cryptocurrency market.

Since its creation in 2008, Bitcoin has experienced only three halvings, with the last one occurring in 2020. Each occurrence of this event is a reminder that the number of Bitcoins in circulation is approaching its ultimate limit of 21 million, adding pressure on its rarity and, by extension, its value.

The concept of halving dates back to the very founding of Bitcoin by Satoshi Nakamoto. Initially, each new mined block brought 50 BTC to its discoverer. This reward was reduced to 25 BTC in 2012, then to 12.5 in 2016, and finally to 6.25 in 2020. The next halving will reduce this reward to 3.125 BTC. These successive reductions are a fundamental feature of Bitcoin’s supply management, a tactic to preserve its long-term value.

The precise date of halvings may vary slightly as they are scheduled to occur every 210,000 blocks, or approximately every four years. However, the exact rate of block creation can fluctuate depending on the network’s total computing power, making precise predictions difficult.

Halving reflects Nakamoto’s philosophy of creating a rare digital currency, similar to finite resources like gold. This scarcity is intended to prevent inflation and encourage value appreciation over time. According to current calculations, the last Bitcoin will be mined around the year 2140.

Will the price of Bitcoin soar?

Historically, each halving has been followed by a substantial increase in the price of Bitcoin. For example, after the first halving in 2012, the price of Bitcoin rose from $12 to $1,207 the following year. Similarly, after the 2016 halving, the price exploded, eventually reaching $16,000 a year later.

However, the halving of 2024 could present different dynamics. Even before this event, Bitcoin has already reached new highs, surpassing $70,000, partly driven by anticipation around Bitcoin exchange-traded funds (ETFs). This pre-halving increase suggests that the immediate impact of the next halving may be less pronounced than in previous occurrences.

When the 21 million Bitcoin limit is reached, miners will no longer receive new Bitcoins for their work validating transactions, but will continue to receive transaction fees. These fees, while currently a small portion of their revenue, could become their primary source of revenue, potentially influencing the fee structure of the Bitcoin network.

Unlike Bitcoin, other cryptocurrencies like Ethereum do not have a fixed unit limit, which influences their miners’ reward policies differently. For example, Ethereum saw a proposal to gradually reduce block rewards, reflecting a less abrupt approach compared to Bitcoin’s halving system.

Halving is therefore more than a simple technical mechanism; it is central to Bitcoin’s economic strategy to manage its scarcity and value, highlighting its role as the potential “digital gold” of the financial future.

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