Every 4 years (on average every 210 thousand units) the prize given to bitcoin miners for adding a block in the blockchain decreases in two times. Bitcoin halving was created by Satoshi Nakamoto to control inflation.
Since the average time calculation unit in the network is 10 minutes, then 210,000 blocks pay for 21000 000 minutes, or 4 years. Last having held in the extraction unit 420 000 9 July 2016. For unit No. 419 999 was the award received in the amount of 25 bitcoins, while unit No. 420, 000 brought to the miner only 12.5 bitcoins.
One of the most characteristic features of bitcoin is its limited number.
Mining new coins increases the supply, which in turn inevitably increases inflation. If the supply increases at the same rate as the number of people using the asset, then prices remain the same. If the price will not grow as fast as demand, there will be deflation, and previously purchased coins will rise in price.
If the demand remains the same, increasing supply theoretically lowers the price. This means that if demand remained constant, the price would have to decline slower after halving.
There is a General opinion that the decrease in supply raises the price. The so-called “ratio of stocks-to-flow” leaves no doubt that there is a connection between alvingham reward per block and increasing the price. This view is quite one-sided presented in the media, which of course increases demand, because everyone wants to profit from a presumably secure higher prices.
An important indicator for bitcoin halving will be the future change Litecoin. If Aldon after halving will continue to grow, it will fuel the hype around Polovinnaya bitcoin. The decline in LTC rates or lack of growth may undermine collective belief in the theory of “stock to flow”, which can negate all the hype.
During the last Polovinnaya the price of BTC actually did not hesitate. The network remained stable. The overall speed of the hash remained unchanged. This suggests that miners are not turned off their devices due to the reduction of the remuneration, as many assumed.
Now you know what halving is no reason to panic. You can track the date of the next Polovinnaya with the help of numerous services on the Internet.