Finally we've got the halving! 630,000 blocks mined!

2 min reading

The most awaited event in the crypto community finally happened. Bitcoin halving will reduce the daily supply, the inflation rate and the prize awarded to the miners. This is also the subject of serious discussions on the price of BTC.

bitcoin halving 2020

2020 Halving - Done!

After months of growing discussion and speculation, the third halving in the history of the most popular cryptocurrency - BTC, has just happened.

Of course, this will bring many changes that will have a significant impact on all those involved, including miners, traders and investors.

Over the next four years, or until the next batch of 210,000 blocks are produced, miners will be awarded 6.25 BTC per block instead of 12.5 BTC.

Block 630,000

As the rewards for miners will be halved, the question is whether mining will still be profitable. One recent study showed that the price of Bitcoin must to rise to about $15,000 or more to be financially viable for miners.

With estimates based on ten minutes of average processing time per block, the number of freshly extracted bitcoins is also halved - from 1,800 BTC per day to 900 BTC.

The drop in daily delivery also means that the inflation rate should fall from about 3.72% before halving to 1.8% now.

Bitcoin Hashrate

Because BTC miners, who are responsible for the bitcoin network, will now only receive half the prize, it is worth examining the potential consequences for hashrate. As we have written before, the hashrate has a sharp increase a few hours before the event.

Now, a few minutes after halving, the hashrate is just over 120 million TH/s.

Although miners receive less BTC after each halving, the latest report indicates that between 2016 and 2020, Bitcoin hashrate increased by over 6800%. Despite growing concerns that miners may capitulate, they have steadily increased their computing power to maintain the network.

women holding 2 bitcoins coinsWhat impact will halving have on the price of Bitcoin?

While the above fundamentals are essential to the health of the network, most of crypto community are interested in what impact halving will have on the price of bitcoin.

On the day before halving, bitcoin experienced significant price fluctuations, and this had nothing to do with historical halvings.

First the price peaked and tested a psychological barrier of $10,000. Then it fell to about $8,000 in a few hours, rose back to $9,200, and then returned to $8,850. Now, after halving, the BTC price is about $8,500.

Looking at the historical graphs, halving has been a significant catalyst for the massive increase in Bitcoin prices. In the months following the first halving in 2012, the value of assets increased from $12 to nearly $1200.

On July 9, 2016, when the second halving took place, the basic cryptocurrency price was at approximately $660 level. A year later, Bitcoin blasted to $2,800, and in December 2017 it reached its highest ever level of $20,000.

Therefore, it is interesting to see whether history will circle and whether we will achieve new ATHs in the coming years.