Halving is Going to Cause a General Effect on all in the Ecosystem

[Darker45]

Right after the 2020 halving, there was a dip in Bitcoin mining difficulty. The network lost some trillion hashes in just a month's time. It was probably due to the halved block reward. Some miners might have been compelled to pause operations due to the decreased reward. But then it quickly recovered thanks primarily to the fast increase of Bitcoin's price. It only took around 6 months from the halving day for the price to double. So it balanced the halved reward. Miners must already be in profit. From then on, the difficulty climbed more or less continuously except when China announced a ban on Bitcoin mining.

So, there could also be a temporary dip in difficulty after the next halving takes place. But recovery will quickly follow.

As to the possible backlash in general, I don't think there will be any. This has been the design ever since. But regardless of a possible event where some miners stop operating because of losses, the difficulty would just adjust and the network continues to operate as always. And a significantly lower difficulty will eventually be enticing for those who want to mine. The price of Bitcoin will also play a vital role.

[bayu7adi]

What possible backlash? All of the miners(or at least those with half a brain) are already aware of the past and future halving events. It's not as if block halvings are something that's sudden and unexpected.

Now, the question is: will it cause us to have more miners(due to potential increase in price) or less miners(some miners being less profitable due to halving of rewards). Time will tell.

What I also seem to be concerned about appears to be similar to your concerns.

So when block rewards decrease, it means that BTC income for miners will also decrease. The minimal BTC earnings should ideally be balanced by the rising BTC price against FIAT to ensure miners can continue to operate their nodes. Of course, it would be a significant concern if the Bitcoin price were to drop, and market demand were to decline, meaning some miners, I believe, would cease operations as they are no longer profitable.

This may leave only savvy miners who harvest their mining results with each new pump or ATH. I've always thought that the ATH formed after halving is the moment for miners to sell the BTC they own, while the subsequent price is the market price traded by everyone.

However, if a price pump doesn't occur after halving, the number of BTC miners could be severely threatened.

[SamReomo]

How will the BTC mining difficulty level affect validators (btc miners) due to 1/2 reduction in reward after the next halving and possible backlash on general ecosystem?

Well, I must say that halving will be helpful for those miners who already know about it. There are many mining farms that will sell their ASIC miners for cheaper rates before and after the halving event, and the determined miners will get a chance to purchase those mining equipment for very cheaper rates. After halving event many of the current miners will stop mining due to less profits from mining operations and that's why the mining difficulty level will drop by significant levels.

But, I must say that those miners who sell their mining equipment and halt their mining operations are the naive ones. I'm calling them naive because they aren't aware of crypto market and the bull run that's going to take place after halving event. Those miners could earn a lot more profit during halving event if they don't sell their equipment right away, but I'm quite sure that most of those miners are just calculating their daily earnings from mining operations and they really don't care much about holding of their mined coins.

There won't be much impact on the general ecosystem of the Bitcoin, but surely difficulty levels will reduce to good levels for at least 2 to 3 quarters depending on some factors. Let's suppose that during the halving event some new and powerful mining equipment are announced and once the miners get those equipment in their hands then the mining difficulty may rise after some time when those ASIC mining equipment's become functional for miners.

[dlightag]

Bitcoin halving has really effect the cryptocurrency market, because many new investors that came in during last Bull Run are feeling disappointed as the crypto market is on the Bear motion that seriously dropping most investors assets to zero dollar. Nevertheless, what need to know about Bitcoin is the nature of the business, base on research, after Bitcoin halving demand always high that skyrocket the price with that other alt-coins follow the uptrend in the cryptocurrency market.

[kryptqnick]

As others pointed out, it's not like halving's a mystery, a secret that miners are unaware of. Yes, the reward is getting twice smaller, but that doesn't mean that miners will feel discouraged because miners are expected to be interested in a potential profit coming from the future increase of Bitcoin's price. FOMO is can also be triggered prior to halving, with people suddenly becoming more aware that 6.25 now is 3.125 in several months. I don't think that halving has a negative effect on Bitcoin market, miners' motivation, transaction fees or anything like that.

[hatshepsut93]

Looking at the past halvenings, there's no immediate hashrate drop due to miners switching off after becoming unprofitable because of the halvening. This is probably because a lot of miners have high enough profit margins that even after halvening they are making profits. Plus the price growth will help to compensate for halvening.

The problems might start arise when the price will become more stable and there will be no more post-halvening bull runs. If mining will become more saturated and profit margins will become lower, then halvenings could have big effects, although at that point transaction fees might start playing bigger role.

[fruktik]

What I also seem to be concerned about appears to be similar to your concerns.

So when block rewards decrease, it means that BTC income for miners will also decrease. The minimal BTC earnings should ideally be balanced by the rising BTC price against FIAT to ensure miners can continue to operate their nodes. Of course, it would be a significant concern if the Bitcoin price were to drop, and market demand were to decline, meaning some miners, I believe, would cease operations as they are no longer profitable.

This may leave only savvy miners who harvest their mining results with each new pump or ATH. I've always thought that the ATH formed after halving is the moment for miners to sell the BTC they own, while the subsequent price is the market price traded by everyone.

However, if a price pump doesn't occur after halving, the number of BTC miners could be severely threatened.

Miners have the option to switch to mining other coins and tokens if this process is not beneficial for mining Bitcoin. Why are people so confident that the price will go up after the halving? For some reason, I don't have that feeling at all. It seems to me that all players will again be deceived and heated for money. Big whales need to make money from smaller whales, right?
To be convinced of this, it is enough to look at the experience of previous years. Something not very many positive moments on the chart.
Therefore, I would not build any illusions about the price increase. It only misleads and gives false hope.

[BVeyron]

How will the BTC mining difficulty level affect validators (btc miners) due to 1/2 reduction in reward after the next halving and possible backlash on general ecosystem?

Please as simple as you can I'd love to get your explanation on this.

I've made previous post regarding this and I'm still making enquires to deepen my understanding so understand me no bad talks please
https://bitcointalk.org/index.php?topic=5458334.msg62494066#msg62494066

I think that it would affect the price of BTC, since mining process becomes longer and more difficult. Moreover, the quality of mining hardware improves after or immediately before halving, so that mining process changes. So, in general, every halving is the chance to improve technical abilities of the network. Price of BTC usually goes up for a bit.

[Mpamaegbu]

I don’t know if you’ve heard of plagiarism here in the forum and what punishment is being applied to account that are found guilty of it.

I don't think you can categorically say the OP's post you quoted was plagiarized. What I read from it is someone who read something somewhere for a long time and internalized it to reproduce later.

Bitcoin halving has really effect the cryptocurrency market, because many new investors that came in during last Bull Run are feeling disappointed as the crypto market is on the Bear motion that seriously dropping most investors assets to zero dollar.

It's their fault and they should bear the brunt. They got themselves where they're because of greed. According to Warren Buffett, I repeat in paraphrase, we should buy when others are scared of buying and sell off once we start seeing people rush into the market. Those investors you so referred to bought when people rushed in. They waited too long to buy in. It's the same way we've been chorusing that now is the right time to buy in because of the incoming Bitcoin halving next year. Sadly, many people are reluctant to do that now. Wait till 2024, you will see them chase the market. But of course, they will buy high then and discover that the market has dumped on them.

[Cantsay]

I don’t know if you’ve heard of plagiarism here in the forum and what punishment is being applied to account that are found guilty of it.

I don't think you can categorically say the OP's post you quoted was plagiarized. What I read from it is someone who read something somewhere for a long time and internalized it to reproduce later.

Yeah, I thought about that before making my post, if you check normally plagiarism report has a dedicated thread for it but since we’re dealing with dates of an event (like I stated in my previous post ) it’s very easy to see similar post like that online this why I just gave him a link to include in his post so as to avoid any drama… Assuming his post was reported as plagiarised or paraphrased post we would have been discussing a different issue now.

And if you check his response to my post he didn’t sound like someone who made a post that turned out to be similar to one that already existed.

Thank you for your feedback! I've added the link as a source in my comment. I'll pay close attention to have the source present going forward.

[Cryptomultiplier]

Quite frankly true, about the general effect. It has only to do with all ecosystems that use BTC or have it in investment form.
It is also an inevitable phenomenon in the actualization of its vision of 21million BTC . 
I wouldn't stress about it much if I were you OP.
Just make your plans to either HODL, trade till then and pause, stay away from BTC till after the halving, trade and HoDL altcoins.

The halving is going to happen, the aim is at the bull run expected to happen after the halving. It is an opportunity to make gains if you are equipped with the right knowledge of trading and BTC investments of course.

[WillyAp]

Halving strategy is a mess, non thought through IMHO.
In the end what will be the role miners will play? They retire?

[Ancemon1]

I think the right time to invest in bitcoin is a few months before the halving. Bitcoin halving will occur in 2024.

Why is it called halving? Now when people mine 1 block of Bitcoin the reward is 6.25 BTC, after the halving it becomes 3.125 BTC. Before the first halving, 1 block was 50 BTC, then 25 then 12 BTC and so on.
Now we are in our 4th halving.

So the right time to buy BTC is when the price rises and then falls sharply, we immediately buy it. My suggestion is to buy it 6 months before the halving and sell it 1 or 1.5 years after the halving.

[Lucius]

What do you think you're doing please? You not only didn't read the post you were too quick to reply to a post that you have short understand on. You should go to the beginners forum and learn about rules of operation here. You won't grow here if you continue like this. Your first objective should be learning.

If you are already warning others that they need to learn something, how about starting from yourself? The rules of good behavior say that you should not use capital letters (and you still use them in title), and also that when you open a topic, you should participate in it.

[KiaKia]

Someone I knee is worried about the future of Bitcoin mining, that if the value of Bitcoin when the halving is halved into 1.5BTC per block isn't good enough it can kill Bitcoin, I told him I disagree, because if the value of Bitcoin drops even more, let's say back to 10k in 8 years it will still looks attractive to holders, also new Asic miners will be created, which will wager things between rewards and electricity consumption, I am not worried about this a bit, Bitcoin always finds it's way out of the impossible, it's going to be fun watching everything unfold in a few years later, I am excited.

[pooya87]

If you want to know the effects of halving on miners, all you have to do is to look at the past 14 years and the past 3 halvings. In other words people who claim it will have a "backlash" because miners make less money have not checked the history where hashrate keeps on growing after the halving even though the income is 50% less in terms of bitcoin.

As for the price, again the history suggests that there will be a hype during the months leading to halving which could cause a rise which will disappear after the halving and price can come down a little. But in long run the decreased rate of supply creation will reduce the sell pressure and price will go up.

[tbct_mt2]

If you want to know the effects of halving on miners, all you have to do is to look at the past 14 years and the past 3 halvings. In other words people who claim it will have a "backlash" because miners make less money have not checked the history where hashrate keeps on growing after the halving even though the income is 50% less in terms of bitcoin.

Hashrate increases a lot, difficulty increases consequently and their increases are sustainable. Bitcoin price grows too to support miner revenues from mining. If miners don't have profit from mining after past halvings, they will shut down their ASICs and hashrate will drop.

It is not what actually happened after past halvings with miners. They continued mining because they still got good profit from mining.

As for the price, again the history suggests that there will be a hype during the months leading to halving which could cause a rise which will disappear after the halving and price can come down a little. But in long run the decreased rate of supply creation will reduce the sell pressure and price will go up.

Halvings are chances for whales to manipulate market so they will create lot of fud and hype to force the market to dive or boost it to rise. Generally I see from past halvings, if you can hold, you will get profit.

Newbies shouldn't trade with leverages and lost bitcoins by liquidations. I learned it and want newbies to understand it if they think they can get rich from trading.

[philipma1957]

How will the BTC mining difficulty level affect validators (btc miners) due to 1/2 reduction in reward after the next halving and possible backlash on general ecosystem?

Please as simple as you can I'd love to get your explanation on this.

I've made previous post regarding this and I'm still making enquires to deepen my understanding so understand me no bad talks please
https://bitcointalk.org/index.php?topic=5458334.msg62494066#msg62494066

I've been reading closely all replies to my post and I'm grateful to all who commented your replies are gonna be helpful what I'll do is sum it up and broaden my understanding. Once again thanks to you all.

this is a solid question.

I would argue the 2012 December ½ ing was too early in BTC to use as an example of what to look for.

This leaves the 2016 July  and 2020 May ½ ing dates.

Covid fucked up all of 2020 so I would toss out the 2020 info.


we would then be left with only 2016 July ½ ing patterns as valid

and are trying to match it up with 2024 ½ ing


https://finance.yahoo.com/chart/BTC-USD

2015 and 2016 monthly closings 19 months time

January >>>>>>>>>>>>>>>>>>  $226.97
February >>>>>>>>>>>>>>>>>   $260.20
March >>>>>>>>>>>>>>>>>>>  $247.27
April >>>>>>>>>>>>>>>>>>>>  $232.07
May >>>>>>>>>>>>>>>>>>>>  $222.92
June >>>>>>>>>>>>>>>>>>>>  $258.62
July >>>>>>>>>>>>>>>>>>>> $281.60
August >>>>>>>>>>>>>>>>>> $228.12
September >>>>>>>>>>>>>>>> $237.54


October >>>>>>>>>>>>>>>> $325.43
November >>>>>>>>>>>>>>>>  $362.48. we kind of match this time right now
December >>>>>>>>>>>>>>>>  $343.33


January >>>>>>>>>>>>>>>>>> $373.05
February >>>>>>>>>>>>>>>>> $435.12
March >>>>>>>>>>>>>>>>>>> $417.96
April >>>>>>>>>>>>>>>>>>>> $451.87
May >>>>>>>>>>>>>>>>>>>> $536.92
June >>>>>>>>>>>>>>>>>>>> $676.29
July the ½ ing for 2016 >>>>>>>> $606.27 July close about 20 days after closing










2022-2024 19 months time






October >>>>>>>>>>>>>>>>>> $20,485
November >>>>>>>>>>>>>>>>  $16,967
December
January
February >>>>>>>>>>>>>>>>>
March >>>>>>>>>>>>>>>>>>> $28,411
April >>>>>>>>>>>>>>>>>>>>  $28,091
May >>>>>>>>>>>>>>>>>>>>> $26,819

June >>>>>>>>>>>>>>>>>>>>  $30,590
July >>>>>>>>>>>>>>>>>>>>    $29,675. this time matches up with bold above
August >>>>>>>>>>>>>>>>>>>  $25,800

Sept
October
November
December
January
February
March
April the ½ ing for 2024.  So I double 25,800 to 51600 and double 30,590 to 61800


my pre  ½ range in early April 2024  is 51.600 to 61,800

[Jon_Hodl]

How will the BTC mining difficulty level affect validators (btc miners) due to 1/2 reduction in reward after the next halving and possible backlash on general ecosystem?

The halving has a minor effect on miners who actually want more bitcoin and a major effect on miners who sell it for fiat.

When the supply of newly mined bitcoin is cut in half from 6.25 bitcoin to 3.125 bitcoin, obviously all bitcoin miners will receive fewer sats for each block that they mine. This will obviously make it more difficult for some miners to mine at a profit so they will have to shut down because they will be spending more money on electricity than they receive from the block reward. Imagine a miner spending $10 worth of electricity to mine $11 worth of bitcoin before the halving but spending $10 to mine $5.50 worth of bitcoin after the halving. They would simply get more bitcoin if they just bought it rather than mining it.

Any rational miner who actually wants more bitcoin would simply shut down their miner and spend the $10 to just buy $10 worth of bitcoin instead of buying $10 worth of electricity to mine $5.50 worth of bitcoin. This does 2 things.
1. It puts downward pressure on the hashrate when they shut down their mining hardware- https://www.whatisbitcoin.com/learn/what-is-the-hashrate
2. It puts upward pressure on the price of bitcoin when they buy- https://www.whatisbitcoin.com/economics/the-price-of-bitcoin

If enough miners shut down and divert their resources to buying bitcoin instead of buying electricity to mine bitcoin, then the difficulty of mining will adjust downward and the price will adjust upward until it becomes profitable enough for some of them to mine again.

Miners who only mine bitcoin to sell for fiat will be hurt much more because they don't actually want the bitcoin. They only want more fiat. What they are actually doing is just speculating on the price of bitcoin but they are using bitcoin mining to do so. They spend fiat to buy mining hardware and then they spend fiat to buy electricity to mine bitcoin and then they sell their bitcoin to hopefully get more fiat revenue than they initially invested. The halving will likely put a lot of hurt on these miners because they are ultimately speculating on the price of bitcoin with some extra steps.

[Good_Doctor]

Right after the 2020 halving, there was a dip in Bitcoin mining difficulty. The network lost some trillion hashes in just a month's time. It was probably due to the halved block reward. Some miners might have been compelled to pause operations due to the decreased reward. But then it quickly recovered thanks primarily to the fast increase of Bitcoin's price. It only took around 6 months from the halving day for the price to double. So it balanced the halved reward. Miners must already be in profit. From then on, the difficulty climbed more or less continuously except when China announced a ban on Bitcoin mining.

So, there could also be a temporary dip in difficulty after the next halving takes place. But recovery will quickly follow.

As to the possible backlash in general, I don't think there will be any. This has been the design ever since. But regardless of a possible event where some miners stop operating because of losses, the difficulty would just adjust and the network continues to operate as always. And a significantly lower difficulty will eventually be enticing for those who want to mine. The price of Bitcoin will also play a vital role.

I must specially thank you for this comprehensive reply.