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Buying your first bitcoin can seem daunting, but it’s pretty simple once you get started.
When we talk about the blockchain technology on this site, we’re usually talking about the Bitcoin blockchain and cryptocurrencies. However, many tech experts – even those who aren’t optimistic about cryptocurrency – are thrilled about blockchain. Here, we’ll talk about various blockchain applications and the ways industries and organisations use both public and private blockchains.
Usually, when we talk about Bitcoin, we talk about adoption in general terms. “People using the coin.”
However, we can – and sometimes should – talk about the adoption in more specific terms. Who is adopting digital currency? How and why are they adopting?
Bitcoin halving – What you need to know
The latest bitcoin halving is right around the corner, so we decided to take a look at exactly what it is, and what it means for bitcoin in 2020 and beyond. Many experts believe the upcoming bitcoin halving, sometimes referred to as the bitcoin halvening, will see a huge increase in price.
Could 2020 be the year we see a Bitcoin price surge?
What does a Bitcoin halving mean?
The Bitcoin Halving is an event that occurs after 210,000 blocks have been mined or on average every four years. When it happens it sees a 50% reduction, or a halving, in the block rewards on the bitcoin network.
When a block on the bitcoin network has been mined, a reward is paid out to the miner in bitcoin. At the moment the reward for a successfully mined block is 12.5 BTC. Around 12 May 2020, the next halving will occur and the reward will drop to 6.25 BTC.
This will be the third halving event in bitcoins decade long history. What will happen to the price of bitcoin due to halving can only be speculated, though experts have argued on both sides, some say a bull run is due, some are expecting a bear market. While it’s always hard to predict markets, especially bitcoin, we can look at the past as a way to try and predict the future.
What will happen when Bitcoin halves?
With the block reward halving every 210,000 blocks mined, a halving has already occurred twice before. The first time was in 2012 which was followed up by the 2016 halving event. After each BTC halving, the following year saw bitcoin’s price rise significantly. The price surge’s that followed each halving saw record price highs, but it’s hard to know if this was due to the reduction in the block reward.
From historical events, it could be assumed that when a bitcoin halving occurs, the price will rise the next year. A year after the 2012 halving, the bitcoin price rose to $1,000USD in November, a record high at the time. Four years and 210,000 blocks later, the 2016 halving event took place. A year later, in mid-December 2017, BTC reached another new record, making an all-time high of $19,500USD.
Will history repeat itself after the 2020 halving? We can only speculate, though it’s sure to be an interesting time for the world’s leading cryptocurrency.
How many bitcoin Halvings are left?
If a bitcoin halving happens every 210,000 blocks, a good question to ask is, how many halvings are left?
To know how many halvings are left, we need to understand a few things.
Firstly, how many bitcoins are there?
The total number of bitcoins to ever exist will be 21 million. Once 21 million bitcoins are mined, the supply will be capped. Currently, in the early stages of 2020, there have been just over 18,200,000 bitcoins mined. With about 1,800 new bitcoins coming into existence every day, and just under 2,800,000 bitcoins left to mine, it might seem that the bitcoin supply is in its final stages.
While this is true in one sense, the timeline of bitcoin is more complicated than you might first think.
One factor to consider is the halving of block rewards. Every 210,000 blocks, the number of bitcoins rewarded halves, and so there are fewer coins being released. As the rewards continue to halve, the supply will continue to slow down.
A second factor to consider is the difficulty of mining. The difficulty is adjusted approximately every 2016 blocks or around every 2 weeks. This is to keep the rate of mining constant. The more miners competing to verify blocks, the more difficult the problems will be. If there are fewer miners, the difficulty will decrease.
The difficulty level of the most recent block at the time of writing is more than 15 trillion. That means, the chance of a computer successfully solving the algorithm to mine a block, is 1 in 15 trillion. This is why it takes so much computational power to mine a block on the bitcoin blockchain.
With the halving and mining difficulty in mind, it’s easy to see that it will take many years to reach the total supply of 21 million bitcoins. This is expected to occur around the year 2140.
So how many bitcoin halvings are left?
If a bitcoin halving happens every 4 years until 2140, that means there will be about 30 more bitcoin halving’s until there are no more bitcoins left to mine.
Is Bitcoin worth investing in 2020?
The bitcoin market is arguably event-driven, so with a huge halving event due in 2020, is it a good time to invest in the most popular cryptocurrency?
The market for Bitcoin has been hotting up in 2020, with a gain of 30% in January alone. Technical Analysis at the time of publication is showing ‘Buy’ recommendations on Moving Averages and with the upcoming halving, believe this year could show strong gains akin to the bull run of 2017.
How did you first hear about Bitcoin?
Skills gaps are exciting because they mean the industry is growing. In the case of blockchain, it also means that the industry can’t grow fast enough.
Are you a long-term thinker when it comes to finances? Looking for more to do with your crypto assets? Hodl onto it with the right Bitcoin investment strategy.
Ideally, a cryptocurrency scam would be caught, the perpetrators put away, and that would be the end of it. Unfortunately, sometimes a scam is revealed and those behind it
As a result, familiarising yourself with cryptocurrency scams is one of the best ways to protect yourself.