The so-called ‘bitcoin halving’ was completed from Friday to Saturday night. This event occurs approximately every four years and is designed to combat bitcoin inflation by increasing the scarcity of the currency. During the halving process, the rewards for creating a new bitcoin through mining are reduced, leading to a deceleration in the influx of new bitcoins into the market. As a result, the cryptocurrency becomes scarcer, prompting an increase in its value.

Miners play a pivotal role in the Bitcoin network by utilizing powerful computers to solve intricate mathematical problems. This process adds new transactions to the blockchain, serving as a global ledger for Bitcoin.

Miners receive rewards through two primary channels: transaction fees paid by users for expedited transactions and mining rewards, which consist of newly generated bitcoins. Presently, miners are rewarded with 6.25 bitcoins for their efforts, equivalent to approximately $437,500. Following the recent halving event that occurred between April 18 and April 21, this reward will decrease to 3.125 bitcoins.

The reduction in rewards results in a slower pace of new bitcoin creation, ultimately leading to a decrease in the overall supply. This scarcity is fundamental in upholding Bitcoin’s value proposition as a digital equivalent of gold.

Historically, halving events have been associated with a substantial surge in the value of the cryptocurrency. Consequently, cryptocurrency investors were eagerly anticipating the fourth halving.

Currently valued at around $64,800, one bitcoin has more than doubled in value over the past six months.

Although the current halving is not expected to have an immediate impact on the price of bitcoin, many investors anticipate significant gains in the coming months. These expectations are grounded in the performance of the cryptocurrency following previous halving events in 2012, 2016, and 2020.

With 19.6 million bitcoins already mined, the total supply is projected to reach 21 million bitcoins. This characteristic distinguishes digital currencies like bitcoin from fiat currencies such as the euro, which can be printed without limitations.