It is undeniable that the Bitcoin halving is a huge event for the entire cryptocurrency market, and not only has a huge impact on Bitcoin. As the year ends, we can really see the real consequences of the halving that occurred on May 11, 2020. In this article, we will learn about the halving and its impact on Bitcoin during 2020.
The role of miners in the blockchain network is Very good introduction Bitcoin and how it differs from other cryptocurrencies and fiat currencies. Otherwise, they will have an indispensable position, because they must solve computational problems in order to verify new transaction blocks in the network. Therefore, their work not only ensures the security of the blockchain network, but without miners, it is impossible for new BTC to enter circulation.
Needless to say, this is a tedious job that requires investment in good equipment, computer hardware, energy, and time. The halving is an event that occurs after the mining of 210,000, which occurs approximately every four years. The purpose of the halving is to halve inflation, because the rewards for miners are also divided into two, each halved. More specifically, the reward was 50 BTC before the first halving in 2012, then reduced to 25 BTC, and by 2020 it was 6.25 BTC.
In general, the price of Bitcoin depends on several factors, such as the position of a competitor’s cryptocurrency, the trading platform that sets its own average price, and the supply-demand ratio. The Bitcoin halving event will have an impact on the supply of BTC, because there will be fewer miners motivated to continue mining, which will further reduce the speed at which new BTC enters circulation.
Otherwise, the supply has been restricted Satoshi Nakamoto To 21 million bitcoins (18.5 million bitcoins have been mined). Therefore, as the demand for BTC increases, the price of Bitcoin will also increase because the number of available BTCs decreases. In fact, the past halvings are related to Bitcoin’s bullish cycle.
The first halving in 2012 caused the price to rise from $11 to $12. Then in 2013, it marked the first significant rise of Bitcoin and reached a price of $1,038 in November. Next came 2016, when the price soared from US$576 to US$650 in 2016. As we all know, 2017 was an important year in Bitocin’s history, as it broke through $19,000 in December 2017.
This brings us to 2020. In 2020, the price after the halving has soared from US$8,784 to US$9,999. A few months after the halving, Bitcoin is still in a bull market and successfully surpassed $17,000 in November. More importantly, this is also the first year to reach USD 20,000 in December.
In addition, the impact on the entire cryptocurrency market and other cryptocurrencies is also obvious. For example, Litecoin surpassed $100 for the first time since 2019. As more and more organizations and people are learning about digital cryptocurrency and seeking investment, it has also reawakened the public’s overall interest in cryptocurrency.
Still, no one can be sure what will happen after the next halving in 2021 or 2024. However, many people believe that the price of Bitcoin will continue to rise. Some forecasts include the possibility of reaching US$96,000 in 2023 and exceeding US$100,000 in 2025. However, one thing is certain.Every halving will strengthen the numbers Gold rush This is also happening.