Ever wondered what Bitcoin Halving means / is and why you should be aware of it?
First you need to know what
Bitcoin mining is. (Bitcoins are produced by miners. Each production is called a Bitcoin block where miners are rewarded by mining each one of them)
Satoshi Nakamoto stated that there are 21 million bitcoins and that the number of Bitcoins generated by block decreases by half every 210.000 blocks. It is estimated that 6 blocks are mined within 1 hour meaning halving event happens each 4 years.
For Miners that means that their rewards are as well halved by 50% as for example if they get 1 BTC for solving each block, 4 years later they will get 0.5 BTC and so on.
This is necessary due to the law of supply and demand a.k.a. keeping inflation under control.
As Ethereum's Project's Development Leader - Vitalik Buterin stated:
“The main reason why this is done is to keep inflation under control. One of the major faults of traditional, “fiat”, currencies controlled by central banks is that the banks can print as much of the currency as they want, and if they print too much the laws of supply and demand ensure that the value of the currency starts dropping quickly.
Bitcoin, on the other hand, is intended to simulate a commodity, like gold. There is only a limited amount of gold in the world, and with every gram of gold that is mined, the gold that still remains becomes harder and harder to extract. As a result of this limited supply, gold has maintained its value as an international medium of exchange and store of value for over six thousand years, and the hope is that Bitcoin will do the same.”Some countdowns that can give you a more deep information into Bitcoin's Halving:
