"Crypto for Dummies". Part 2: What is halving and why it is causing a stir in the cryptocurrency market
Kyiv • UNN
What is halving and why is it causing a stir in the cryptocurrency market
There are 23 days left until the bitcoin halving. Cryptocurrency buyers are trying to use this time to maximize the number of bitcoins in their wallets. Olena Sosedka, co-founder of Ukraine's first fintech ecosystem Concord Fintech Solutions, spoke about what halving is and why the price of one of the world's most expensive coins can increase dramatically, UNN reports.
"For those who are in the know, but still: *Bitcoin halving* is an event that occurs approximately every four years when the reward for mining a single block is cut in half. This is a key moment in the bitcoin ecosystem, envisioned by its creator (or creators) under the pseudonym Satoshi Nakamoto to control inflation and gradually reduce the number of new bitcoins entering circulation," wrote Sosedka on her Facebook page.
According to her, the importance of halving is that it directly affects the bitcoin economy by reducing the rate of its emission. This, in turn, could theoretically increase its value due to the growing shortage.
Sosiedka recalled that the first halving took place in 2012. After it, the price of bitcoin soared from $12 to more than $1,000 per coin in 2013.
The second halving, she said, was in 2016 and also led to a significant increase in the value of the cryptocurrency. By the end of 2017, bitcoin reached almost $20,000 per coin.
The last known halving, which took place in 2020, also met expectations, and by April 2021, the price of bitcoin jumped to a record $64,000 per coin.
"Every time we have followed a halving, we have seen significant fluctuations in the price of bitcoin. This makes the upcoming halving a particularly exciting event for investors, traders, and all members of the crypto community. What's in store for us this time? Will the story remain true to itself, or will the market surprise us with a new twist?" - Sosedka added.
Recall
UNN has launched a series of publications that will tell about digital currencies and their possibilities. Our first material was devoted to the technology underlying cryptocurrencies - the blockchain: "Crypto for Dummies". Part 1: what is blockchain and its "features" that few people know about.
