Bitcoin’s fourth halving event, which will happen during midnight on April 20th, will reduce the reward per block for miners from 6.25 BTC to 3,125 BTC. This event is expected to significantly impact the price dynamics of the cryptocurrency and mining activities.
These halving events, which occur automatically every 210,000 blocks or about every four years, slow down the increase in Bitcoin’s supply, creating a deflationary effect.
Studying the historical effects of previous halving events on the Bitcoin sector could help us better understand the potential long-term outcomes of this event on the market.
A Look at Previous Bitcoin Halving Events
Bitcoin’s historical price surges have been significantly influenced by halving events, indicating the growing potential of the cryptocurrency’s increasing adoption process. Bitcoin’s protocol has demanded three halving events to date: The first, in 2012, reduced the reward per block from 50 BTC to 25 BTC. The second, in 2016, reduced the reward to 12.5 BTC, and the third, in 2020, reduced it to 6.25 BTC.
It is anticipated that the expected halving in 2024 will decrease the mining reward to 3,125 BTC per block from the current 6.25 BTC. According to Bitcoin’s design, once these subsidies end, only a total of 21 million Bitcoin will ever be produced, reinforcing Bitcoin’s limited supply structure and deflationary features.
What Will Happen After the 2024 Halving Event?
Bernstein predicts that Bitcoin’s impending halving event will continue its upward trend and could reach $150,000 by the end of 2025.
Coinify CEO Rikke Staer warned about Bitcoin sales after halving in the interview with @TheBlock. He attributed his expectations to the strengthening presence of institutional investors.
Coinify analyst Rikke Staer, however, considers the halving event as a “selling news” event. According to Staer, it might be necessary for inefficient miners to release their existing Bitcoin assets into the market in order to sustain operations, creating selling pressure in the short term.
Bitcoin’s price is currently trading around $63,933, indicating a 0.8% increase in the last 24 hours, according to CoinMarketCap data.
Earlier today, the price dropped below $60,000 after reports of Israel’s missile strike on an Iranian facility, but it has shown a strong recovery since then.
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