The last Bitcoin halving is happened on the 11th of May 2020. So things did get a bit crazy for the potential price of Bitcoin. The Bitcoin halving basically halves the block reward that Bitcoin miners get. So this means there will be less Bitcoin available,markets are all about supply and demand. After all Bitcoin is a Deflationary system,while FIAT money (USD) and others are inflationary.
Disclaimer:This article is not financial advice,so make sure you talk to a professional financial adviser before investing or getting into Bitcoin and cryptocurrency. Bitcoin and other blockchain assets are well known for being volatile,and you could lose money.
what is bitcoin halving
After every 210,000 blocks of Bitcoin are mined, Bitcoin goes through a process called “Bitcoin halving.” This mechanism was programmed into the protocol by Satoshi Nakamoto,the creator of Sha256 Bitcoin protocol.
The Bitcoin halving event happens every 4 years.
After a protocol goes through “halving” process, it then cuts the supply of new Bitcoins in half, halving the miner’s block production rewards. So Bitcoin miners will get less Bitcoin when solving the sha256 algorithm with their ASICS and Cloud mining.
Bitcoin’s protocol only allows for a total supply of 21 million Bitcoins to ever exist. This is once they have all been mined. As of the beginning of 2020,approximately 18 million Bitcoins have been mined into existence.
The Bitcoin halving will make the available supply of Bitcoin more scarce per block reward and in general. This can effect the price like any other traded commodity or stock.
what will happen when bitcoin halving kicks in
Supply and demand are affected this can cause a price increase,because less Bitcoins are issued. In the year of 2012, the amount of new bitcoins issued every 10 minutes dropped from 50 bitcoins to 25. In 2016, it dropped from 25 to 12.5. Now, in the 2020 halving, it will drop from 12.5 to 6.25,so you can see the significance of the Bitcoin halving event.
So as mentioned before,the amount of Bitcoin that miners get will be half as much every four years. Because there is less supply of new Bitcoin,people start to horde and buy Bitcoin,this drives the price up.The price can drop though,because miners sell sending prices lower.There was massive increase (Bull Run) in the Bitcoin Price 2016/2017, just after the 2016 Bitcoin halving.
So you can see the significance of this from a Bitcoin or any other Traders view point.
how to trade bitcoin halving
I said at the beginning of this post,I am not offering financial advice,so trading can be a risky business. You can do technical analysis for FREE at https://uk.tradingview.com/
Like in business ventures or trading markets,there can be massive rewards to people who take risks,as well as massive losses. Just make sure that you don’t listen to FOMO (fear of missing out) and make an informed descision when deciding to buy/sell and trade the crypto/Bitcoin markets.
A platform I use myself is Bittrex,it’s a long trusted cryptocurrency platform with cutting edge security feature like 2FA authentication and verification of your identity when signing up.
If someone trys to log into your account from a different browser or I.P address,Bittrex will email your account email address to do a secure login.
You can also deposit funds by Credit and Debit Card straight into Bittrex,this makes trading easy just like Coinbase and other platforms.
Although I do like Coinbase for it’s simplicity,I find it too basic when doing technical analysis. Bittrex has candle stick charts and plenty of indicators to help you with your trading decisions.
If you want to have a go at trading Bitcoin and Cryptocurrency,you can join Bitttrex below.
Do your homework on Bitcoin and cryptocurrency for FREE at https://uk.tradingview.com/
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