The oldest digital asset, Bitcoin, is getting ready for its halving event, set to take place in 2024. Through an array of all-time highs and lows that the Bitcoin market has shown us since 2020, one thing remained unchanged, that is, the total availability of this particular crypto asset. There will only ever be 21 million Bitcoins available in the world.
However, the nearing of the once in four years halving event has started to cause some expectations and actions from the crypto community. One of the most anticipated expectations from the Bitcoin community is that the Bitcoin mining hashrate, which is basically a measure of computing power that is used on the network, is likely to see a dramatical decline within a year from 2024, once the division of the mining rewards is halved.
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Bitcoin Halving: Key Events
|Event||Date||Block Number||Block Reward|
|Launch of Bitcoin||January 2009||0 (genesis block)||50 new BTC|
|First halving||November 2012||210,000||25 new BTC|
|Second halving||July 2016||420,000||12.5 new BTC|
|Third halving||May 2020||630,000||6.25 new BTC|
|Upcoming halving||Tentative; May 2024||740,000||3.125 new BTC|
Once every four years, when the halving event takes place, the reward for the miners gets successfully cut in half. This event, known as the halving, results in reducing the inflationary pressure on Bitcoin. Since the halving event in 2020, the mining rewards have been 6.25 BTC per block, which amounts to $170,000, and in April 2024, they will be halved to 3.125 BTC per block, which amounts to $85,000.
According to the head of research at mining consultancy Blocksbridge, Wolfie Zhao, as of today, the publicly listed miners mine BTCs at the cost of $10,000-$15,000 per bitcoin. Following the halving event of 2024, these mining costs will double in price, which will bring the miners’ breakeven point to a whopping $20,000-$30,000.
Additional Read: Bitcoin Halving in 2024
With the possibility of such a high cost of mining and the absence of any significant rally in the price of Bitcoin, it is said that only the most cost-efficient miners will be able to survive this, while others might be forced to shut down their operations.
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