Well-known data about Bitcoin
Bitcoin Mining
Bitcoins, and many other cryptocurrencies, are created through a process called mining. The term mining is not used in a literal sense but as a reference to the way precious metals are gathered. Bitcoin miners solve mathematical problems and confirm the legitimacy of a transaction. Miners use considerable computational power to authenticate transactions that have taken place on the Bitcoin blockchain. Once authenticated, these transactions are added as blocks and create chains of these blocks of transactions, forming the blockchain.
Bitcoin Halving
Bitcoin halving is a process of dividing the number of generated rewards per block in order to maintain the total supply of Bitcoin, which will not exceed 21 million.
After every 210,000 blocks mined, or roughly every four years, the block reward given to Bitcoin miners for processing transactions is cut in half. This cuts in half the rate at which new bitcoins are released into circulation. This is Bitcoin’s way of using a synthetic form of inflation that halves every four years until all bitcoins are released into circulation.
The first Bitcoin halving in 2012 after a total of 10,500,000 BTC had been mined reduced the reward for mining a block from 50 BTC to 25 BTC. In 2016, the halving event cut rewards again to 12.5 BTC per block mined, and as of May 11, 2020, 6.25 new BTC are created with each new block mined.
Does Halving Have Any Effect on the Bitcoin Price?
As Bitcoin halving takes place, the supply of available Bitcoins becomes smaller, thus increasing the value of the Bitcoins yet to be mined. And with those fluctuations come the chance to profit. Empirical evidence does show that Bitcoin prices tend to rise in anticipation of a halvening, often several months prior to the actual event.
The next Bitcoin halving?
The next bitcoin halving is expected to take place in 2024 when over 840,000 bitcoin blocks must’ve been mined.
Bitcoin is already set with its last to-be-mined block. The last block will be uncovered sometime in 2140.
What Happens When There Are No More Bitcoins Left in a Block?
Around the year 2140, the last of the 21 million bitcoins will have been mined. At this point, the halving schedule will cease. Miners will still be incentivized to continue validating and confirming new transactions on the blockchain because the value of transaction fees paid to miners is expected to rise into the future, the reasons being that a greater transaction volume that has fees will be attached, plus bitcoins will have a greater nominal market value.
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