What is Bitcoin halving?
In a very simple and understandable definition halving means to divide something in 2 equal parts🫠.
When any coin/token is launched there is a policy or algorithm written in it's whitepaper so accordingly,it would initiate, same as with BTC, its halving process is already mention in it's mining algorithm every 4th year.Halving process is necessary to have an control over BTC inflation.As inflation would decrease BTC performance and correction.
BTC is generated/produced (as it is intangible entity) by miners,miners needs to get a “block”,block is a file containing 1 megabyte (MB) of Bitcoin.By solving a complex mathematical problem they get a "hash" and after finishing it get locked so can't be changed after.By completion of blocks,miners received BTC.
Miners were paid 50 BTC per block when the process was started.After halving event was occurred it was reduced to half.
Halving 2012 miner's rewards were reduced to 25
Halving 2016 miner's rewards were reduced to 12.5
Halving 2020 miner's reward were reduced to 6.25
Halving 2024 miner's reward would reduce to 3.125
Last halving is expected in year2140.
Halving Impact on market
First;number of miners are declining as less BTC is rewarded, so If demand remains same price will increase.If we go through past halving events definitely there is a significant effect on all crypto after halving.Halving left impact on market gradually before but this time we need to witness as market is already on bull run.
Second;As already miners are allocated to half of rewards they look upon to cost efficiency and to raise BTC price to set theirselves in profits and to compete with high cost processing.However in the last sessions bull run is proved also.
Third and concluded in my opinion as more countries get involved in and if using Bitcoin as their crypto currency it's efficiency would become more visible. More importantly, the price of Bitcoin is likely to rise due to more demand.More demand links increased price.So finger 🤞 for halving.
