Home Bitcoin 2020 Bitcoin halving, effects on crypto holders

2020 Bitcoin halving, effects on crypto holders

After every four years, according to laid down regulations by Bitcoin’s pseudonym creator, Satoshi Nakamoto. Halving, a process, where the entire block rewards provided to miners are split into two, takes place. 

The process is a periodical event when cryptocurrency production is cut by 50%. It slashes the amount of coins bitcoin miners get and is scheduled to hold May 2020. During this time, the amount of Bitcoin cryptocurrency entering into circulation is reduced. While at the same time, mining costs for securing the network increase.

Bitcoin alongside many other cryptocurrencies being a decentralized token requires to be moderated occasionally. 

Halvings are at the core of the cryptocurrency economic models because they ensure coins will be issued at a steady pace, following a predictable decaying rate. This controlled rate of monetary inflation is one of the main differences between cryptocurrencies and traditional fiat currencies, as they have an infinite supply.

Reportedly, in the history of Bitcoin, there have only been two previous Bitcoin halving events. These events occurred 28th, Nov. 2012 and 18th, July 2016 with Bitcoin priced at $12.31 during the first and $650.63 during the second. 

Also, it is being said that throughout, there will only be 32 bitcoin halving events. Once all of these have occurred, there will be no more halvings and there will also be no more Bitcoin created as the maximum supply will have been reached.

2020 halving: Analysts react, says run up imminent

As the entire crypto world awaits the 2020 halving event, pundits are beginning to predict and speculate as to what should be expected after the event. 

Many analysts reportedly agree that the coming halving will trigger a run-up in Bitcoin price, and by extension other cryptos as the market mover and most paired token, dragging the rest of the cryptocurrency market upwards with it. 

Nunya Bizniz, a Bitcoin advocate while analyzing the previous halving explained that a 50% dip and then a climb upwards during the 120 days before the first halving in 2012.  

In 2018 however, 120 days before the event was a stellar 88% upswing, followed by a 30% crash. A recovery further proceeded this, and then another crash after the halving had occurred. 

From these two previous experiences, it can be said that there is no precise expectation to follow these years halving as past performances can not be taken as an indicator of future performance.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Must Read

Staking: these are the 5 preferred cryptos for passive profits

Staking has been called in various ways, some accurate, others not so much. This has also happened with PoS,...

United Kingdom forces to block cryptocurrency advertising

The advertisements of the company Luno will be withdrawn from the United Kingdom after the resolution that obliges them to do so...

Cryptocurrencies find some relief after their crash

Cryptocurrencies find some support for a bounce after one of the toughest weeks for investors. Although last Thursday we...

China Strikes Cryptocurrencies Again, Bitcoin Slumps Again

The highest level of government in China has proposed new measures to regulate mining in the country. The proposal has been received...

Bitcoin on the Playstation? Sony’s patent finally accepted

On May 17, 2021, the publication of a patent by Sony Interactive Entertainment mentioning Bitcoin was greeted with great fanfare by the...