Satoshi Nakamoto, a person or group whose identity remains unknown to this day, created the digital currency Bitcoin on Jan. 3, 2009. A whole cryptocurrency industry was born out of it, one that has become increasingly mainstream.
Is Bitcoin too speculative?
Bitcoin prices have been on a roller-coaster ride over the past few months. But something coming soon that’s known as a Bitcoin “halving” event could shoot them to new highs throughout the year. Bitcoin halving, a technical event that occurs every four years and cuts the reward for mining new Bitcoin by half. The feature is important to understand how Bitcoin functions.
In mid-April, the reward miners get for minting new Bitcoin will be cut in half, from 6.25 bitcoin to 3.125. This happens every four years and will continue until all 21 million Bitcoin are mined. While the exact date of the halving event remains unclear, it’s set to take place on or before April 19.
Halving was written into Bitcoin’s code from the beginning to ensure scarcity and safeguard against inflation. Previous halving events coincided with huge Bitcoin price increases.
Here’s what to know about the coming Bitcoin halving, as well as what it will mean for Bitcoin’s price and more.
What is Bitcoin mining? How is Bitcoin generated?
Bitcoin is generated by miners who use computer hardware to solve complex mathematical problems and verify transactions on the blockchain network. In return, miners receive a predetermined amount of Bitcoin for each block of transactions they process.
The reward, which is given to miners who verify the transaction, is a way to create more Bitcoin. The first Bitcoin block, also known as the Genesis Block, was created by Nakamoto in 2009 and was rewarded with 50 Bitcoin.
Why is Bitcoin halving important?
Bitcoin’s supply is limited to a maximum of 21 million coins. This means no additional coins will be generated or created after reaching that 21 million limit. Nakamoto introduced the concept of Bitcoin halving to limit the quantity of the cryptocurrency and make it more valuable to combat inflation. That’s why Bitcoin halving is important, as it…
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