Bitcoin, which saw its second peak with about 13 thousand 700 dollars in June 2019, decreased to 4 thousand 980 dollars in mid-March 2020. While fluctuations in the market value of Bitcoin continued, the third halving in its history also took place. So what does Bitcoin halving mean, will it have an impact on market value?
The most valuable cryptocurrency in the world, Bitcoin, has a limit. There is a halving half-life event, which must go through production every four years until its supply reaches that limit. The reward per block issued by Bitcoin miners is reduced by half after this halfway event. With the previous half, the reward for miners per block fell from 25 BTC to 12.5 BTC. With the third halving on May 11, 2020, this value fell to 6.25 BTC.
With all the mining activities held to date, 85% of the Bitcoin supply has been mined. 18.3 million units of Bitcoin, with a total limit of 21 million, were produced. Thanks to Halving (Halfway), the production rate is slowed and the supply balance is tried to be created.
Bitcoin saw a third pre-halving decline:
Before the second halving of July 7, 2016, the value of Bitcoin had approached the $ 800 level at $ 200 a year. However, before the third halving, the value of Bitcoin did not increase, but it decreased. Bitcoin, which broke the record by declining to $ 4980 in mid-March, had a steady rise until May 7 and had reached $ 9,945. Halving event fell to the level of $ 7 thousand 400 days before.
At the time of writing this news, expectations are high for Bitcoin traded at $ 8,700. Bitcoin miners will now receive half fewer rewards per block in BTC. However, since the expenses such as electricity spent during mining will not change, the income will be halved while the expenditure will remain constant. So there will be a serious decrease in profitability. This will lead miners to move away from the system and their numbers to decrease.
Of course, these are the things that we look at to happen. However, less and harder production of Bitcoin may lead to further appreciation as an exchange or investment tool. Bitcoin is now a digital mine 50% harder than the previous period. It is known how precious mines are.
The value of the Bitcoin market due to its standing and rarity is how much investors, in other words, how much money is left in the system. What will happen in Bitcoin after May 11, 2020, will give clues about the near future.