Bitcoin halving is a process that occurs every 210,000 blocks mined (approximately every four years) and reduces the block reward for miners by half. This means that the number of new Bitcoin entering circulation is halved, which can have a significant impact on price.
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Why does Bitcoin halving occur?
Bitcoin halving is a key part of the Bitcoin protocol and is designed to control the supply of new Bitcoin entering circulation. This helps to keep Bitcoin scarce and valuable, and also helps to prevent inflation.
How does Bitcoin halving impact price?
Historically, Bitcoin price has risen significantly after each halving event. This is because the reduced supply of new Bitcoin can lead to increased demand from investors and traders. However, it is important to note that there are many other factors that can affect Bitcoin price, and it is impossible to predict with certainty how the next halving will impact the market. Remember, there is a max supply of 21,000,000 $BTC, and no more can be created after that. It's simply supply & demand.
Implications of the Bitcoin halving event
The Bitcoin halving event will have a number of implications for miners, investors, and the overall Bitcoin network.
- Miners will need to adjust to the reduced block reward and increased competition.
- Investors may see the halving as an opportunity to buy Bitcoin at a lower price, in anticipation of a future price increase.
- The overall Bitcoin network may become more decentralized as less efficient miners are forced out of the market.
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When is the next Bitcoin halving event?
The next Bitcoin halving event is expected to occur April 17th 2024. You can track the halving count down here https://buybitcoinworldwide.com/halving/
Personal predictions
Please note that my personal predictions about Bitcoin price are not financial advice. Investors should always do their own research before making any investment decisions.
I predict that Bitcoin will reach a minimum of $80,000 and a maximum of $130,000 by Q2 2025 if certain events occur, namely:
- Rate cuts: A lower dollar typically leads to a higher Bitcoin price.
- International turmoil calms down: Political and economic stability can boost investor confidence and lead to increased investment in Bitcoin.
- Bitcoin spot ETF is approved: A Bitcoin spot ETF would allow investors to buy and sell shares of Bitcoin without having to buy the cryptocurrency directly. This could make Bitcoin more accessible to a wider range of investors and lead to increased demand.
I do not like to have very high price predictions. Many "analysts" of the post 2016 halving run and post 2020 halving run would make outlandish claims of 1M by the end of the year. This is why I stay conservative.
It is important to note that the author's personal predictions about Bitcoin price are not financial advice. Investors should always do their own research before making any investment decisions.
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