Bitcoin halving, occurring approximately every four years, aims to decrease miner rewards. The fourth halving has reduced the block subsidy from 6.25 BTC to 3.12 BTC, directly impacting miner revenue.

The total supply of Bitcoins is limited to 21 million coins. (Image Credit: Bing Image Creator).

Key Points

• Bitcoin halving is a significant event shaping the cryptocurrency landscape.
• Less efficient miners may leave the network due to reduced incentives.
• Only the most efficient ASIC machines can now mine profitably.

New Delhi: Bitcoin halving, a rare event recurring every four years, drives prices upward by slowing the influx of new tokens, thereby enhancing Bitcoin scarcity. This scarcity is anticipated to boost prices, similar to the previous halving events. The mining reward for the leading cryptocurrency has now halved to 3.125 BTC from 6.25 BTC per mined block, directly impacting miners’ earnings.

The Bitcoin halving took place on April 19, 2024, as miners hurried to extract the remaining blocks before the reward reduction. While the community anticipated the halving on April 20, the 840,000th block was mined a day earlier. The network undergoes halving every 210,000 blocks. Previous halving events occurred in 2012, 2016, and 2020, reducing rewards from 50 to 25, then to 12.5, and finally to 6.25 BTC.

Profitability Reserved for the Most Efficient Miners

The halving is poised to bring substantial changes to the crypto ecosystem. Only the most efficient Application-Specific Integrated Circuit (ASIC) machines are expected to remain profitable. Outdated and less efficient ASICs might phase out, making room for next-generation ASICs with specific breakeven power costs based on hashprice.

Miners are exploring custom ASIC firmware like BraiinsOS and LuxOS to enhance hardware efficiency, reducing breakeven points for electricity expenses. Less efficient miners are likely to exit the network due to reduced profitability, as they will now receive half the rewards for their mining efforts.

Ecosystem Response to Previous Halvings

After the first halving in 2012, the network hash rate dropped, leading to the exit of less profitable miners. In early 2013, Bitcoin witnessed its first bull run, with prices surging from \(13 to \)1,000. Following the second halving in 2016, prices initially dipped to \(670 but later climbed to \)2,550 in 2017. During the third halving in 2020, BTC prices hovered around \(10,000, eventually reaching \)62,000 in 2021. Currently, BTC prices stand at approximately $65,000, with expectations of a surge in the coming six months to a year.

Latest Updates

For more stories, follow us on social media.