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What can we expect from the Bitcoin halving event?

30/04/2024

The world is awaiting the next Bitcoin halving event, expected to take place on around April 19th or 20th. But what is it all about, and what does it mean for cryptocurrency investors? Read on to find out…

 

What exactly is Bitcoin halving? 

There will always be a finite number of Bitcoin: 21 million in total. Currently, around 19.6 million of these 21 million have already been mined, and it’s expected that mining will not be complete until the year 2140. 

Over time, Bitcoin production slows down: a tactic designed to increase scarcity and thereby increase Bitcoin value. Halving events take place every four years. Here, the reward for the mining of new blocks is halved, and the number of new Bitcoins introduced is reduced. But what impact does this have on Bitcoin pricing – and investors? 

 

What Bitcoin halving means for investors

The last Bitcoin halving event took place on May 11th, 2020. In the month leading up to the halving event, Bitcoin’s price rose from $6,877.62 to $8,821. While the price was fairly volatile over the subsequent year, it continued to rise and reached $49,504 in May 2021. 

This wasn’t a one-off, either. In both 2012 and 2016 the price continued to rise after the halving events took place. 

But will things be the same this time around? In theory, an increase in scarcity should result in further increases in Bitcoin prices. It’s possible that the halving could result in smaller miners dropping out of the Bitcoin race as their rewards will be lower. Ultimately, though, it is likely that Bitcoin’s future prices will be determined mainly by how much people believe they are worth. With so many competing cryptocurrencies on the market, could its value actually decrease over time? 

 

“Stable Rise Limited is not authorised or registered by the Financial Conduct Authority. The marketing materials are not intended to provide financial advice nor promote any individual financial products.”

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