Bitcoin enthusiasts and investors have marked their calendars as the next halving event is less than 200 days away, specifically set for April 17, 2024.
Key TakeawaysThe concept of “halving” is integral to Bitcoin’s underlying design.
It signifies the moment when the rewards for miners, in terms of the number of bitcoins they receive for confirming transactions and adding them to the blockchain, are reduced by 50%.
This phenomenon occurs approximately every 4 years, or after every 210,000 blocks are mined.
The halving mechanism is not just a one-time event but a recurring feature until roughly the year 2140.
This is the projected year when the capped supply limit of 21 million bitcoins will be reached. Consequently, this will halt the introduction of new bitcoins into the broader market.
The future post-halving era presents a conundrum.
Once the entirety of the 21 million Bitcoins is mined, miners’ only source of revenue will come from transaction fees.
This poses a challenge since there are concerns that these fees might not suffice to cover the miners’ operational expenses.
One potential solution debated within the community is the removal of Bitcoin’s hard supply cap, but this proposal remains steeped in controversy.
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