The Bitcoin Halving
With Bitcoin’s 4th halving just 30 blocks away…and likely to happen today, here is a summary of the recent ZeroHedge article with all you need to know.
One small correction to their article: there is no mathematical problem being solved, its just a lottery of random numbers being generated that need to match certain criteria in order to win the right to write the next block.
Bitcoin Halving Explained: Every 210,000 blocks, the reward for mining Bitcoin is halved, which reduces the rate at which new Bitcoins are created and aims to extend the life of the mining ecosystem. This halving occurs approximately every four years and is intended to mimic the scarcity of resources like gold.
Impact on Bitcoin's Value: Historically, halving events have led to significant increases in the price of Bitcoin due to a perceived supply shock. The article discusses how past halvings have driven the price higher as the reward for miners decreases, potentially increasing the scarcity and value of Bitcoin.
Comparative Analysis with Gold: Post-halving, Bitcoin's inflation rate will be lower than that of gold (which is about 2% per year). This positions Bitcoin as a potentially more stable store of value in comparison to traditional assets.
Long-Term Predictions: The article forecasts that the decreasing supply of new Bitcoins due to successive halvings could lead to a monumental increase in Bitcoin's value, particularly as the total block rewards approach less than one Bitcoin per day by 2060.
Cultural and Economic Shifts: The halving is seen not just as a technical event, but as part of a larger shift towards a new monetary system that is decentralized and not controlled by traditional state-based systems. This could represent a significant transfer of wealth from traditional fiat currencies to Bitcoin, reshaping economic power structures.
📚Read the full article by ZeroHedge here: https://www.zerohedge.com/crypto/bitcoin-halving-crash-course-what-it-why-it-matters