Bitcoin BTC -2.87% ’s next halving event is now just one week or approximately 1,000 blocks away, according to The Block’s Bitcoin Halving Countdown page.
ET), to reach the next halving block height of 840,000, as things stand.
Bitcoin’s next halving event will see the subsidy reward for miners on the network drop from 6.25 BTC to 3.125 BTC per block.
Bitcoin halvings are programmed to occur automatically every 210,000 blocks — roughly every four years.
Once a halving event occurs, miners receive 50% fewer bitcoins as a subsidy reward for every block of transactions they mine and add to the blockchain.
Is the Bitcoin halving a ‘sell-the-news’ event?
Historically, Bitcoin halvings have been associated with significant fluctuations in the cryptocurrency’s price.
A sample size of three is not large enough to be conclusive and other factors also contributed to gains following prior Bitcoin halvings, the analysts added.
According to The Block’s Bitcoin Halving Countdown page, the next halving event for Bitcoin BTC -2.87 percent is now only one week away, or roughly 1,000 blocks away.
The countdown is estimated to begin at approximately 9 a.m. on April 20 based on Bitcoin’s average block generation time of 10 minutes. me. UTC (5:00 a.m. me. In the current situation, ET), to get to the next halving block height of 840,000. The subsidy reward for miners on the network will decrease from 6.25% to 3.12% per block during the next halving event of Bitcoin.
The automatic halving of Bitcoin is scheduled to happen every 210,000 blocks, or approximately every four years. Miners get paid 50% less in bitcoins as a subsidy reward for each block of transactions they mine and add to the blockchain after a halving event. They still receive extra transaction fee rewards for every block that is mined, though, as usual.
In the history of Bitcoin, there have been three halving events: the block subsidy inflation was reduced from 50 BTC to 25 BTC in 2012, then to 12 PPI BTC in 2016, and to 6 PPI BTC at the final halving on May 11, 2020. Only 21 million bitcoins will ever exist in the long run.
It is anticipated that the final bitcoin will be mined sometime in 2140, after which the halving events will continue. Miners will then only be compensated by transaction fees.
The final adjustment prior to the halving of Bitcoin brings mining difficulty to an all-time high.
As miners seem to be increasing their hash rate in anticipation of the block subsidy reward drop, the difficulty of mining bitcoin increased by 3 points to 9 percent this week, reaching a new all-time high in the final adjustment before the halving.
An average of one new block is found every 10 minutes, regardless of the number of miners who are actively mining, thanks to the Bitcoin mining difficulty algorithm, which adjusts every 2016 blocks, or roughly two weeks. The more computational power a miner needs to locate the next block, the higher the difficulty.
According to The Block’s data dashboard, ahead of the difficulty adjustment on Wednesday, Bitcoin’s hash rate—which gauges the total processing power contributed to the network by miners—reached a new seven-day moving average all-time high of 629.75 EH/s.
It is still unclear how much of an impact the halving will have on less productive mining operations and, consequently, the overall network metrics after the reduction in subsidy, even though miner revenues have increased this year along with the price of bitcoin.
A “sell-the-news” event, is the halving of Bitcoin?
Price fluctuations of notable magnitude have historically been linked to Bitcoin halvings. These occurrences have frequently come before significant bull runs in the bitcoin market, even though there isn’t a clear cause-and-effect relationship.
Prices increased one to three months after two of the previous three halvings. Prices increased in each of the three halvings nine and twelve months later, according to Kaiko analysts earlier this week.
The analysts noted that other factors may have contributed to gains following previous Bitcoin halvings and that a sample size of only three is insufficient to draw firm conclusions. Bitcoin’s implied volatility for different options expirations, however, points to short-term market instability. “The largest increase has been observed in IV for expiries in the next two weeks, rising from 59% to 71% in just two days,” they reported.
As the new U.S. s. Strong inflows of $12.06 billion have been observed into spot bitcoin exchange-traded funds overall, which may indicate a positive price impact as new supply declines after the halving. However, the Kaiko analysts cautioned that “in the case of a bearish reversal, BTC could flood the market, thus posing an uncertainty.”.
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