Will the Bitcoin halving make you a millionaire?
Hey boarder,
If you’re interested in crypto, you’ve probably heard about the Bitcoin halving. If you haven’t I’ll help you climb out from the rock you’re living under. The Bitcoin halving is one of the crypto industry’s most anticipated events. It happens every 4 years and is right around the corner - predicted to happen sometime in April, 2024.
What exactly is the Bitcoin halving?
Think of a large chocolate bar you keep splitting in half whenever you share it with friends. The Bitcoin halving is similar. In the Bitcoin universe, only a certain number of new Bitcoins can be created. When Bitcoin began, a lot of new Bitcoins were made daily. But every four years, a halving occurs, cutting the daily production of Bitcoins by half.
Specifically, it lessens the prize Bitcoin miners (those who check transactions on the network and make new blocks) get for each new block they create on the blockchain. This highlights Bitcoin's main feature: scarcity. Unlike regular currencies and goods, there will never be more than 21 million Bitcoin.
In 2009, mining 1 block would earn you 50 BTC. This was halved to 25 BTC, then 12.5 BTC. Currently, the reward is 6.25 BTC, and after the ‘Halving’, it will be 3.125 BTC.
Why should I care?
Think of Bitcoin like a jar of marbles that gets fewer every day. This is what happens during a Bitcoin halving.
When new Bitcoins are less, the existing ones can become more valuable. Past 'halving' events have often led to a rise in price, leading to a crypto boom.
In November 2012, the price at the 'halving' was $12.35. 90 days later, it was $1,007.37.
In July 2016, the price at the 'halving' was $650.53. 90 days later, it was $2,506.17.
In May 2020, the price at 'halving' was $8,821.42. 90 days later, it was $56,612.10.
When is it happening?
It occurs about every four years, similar to how you wait for your next birthday if you were born in a leap year. The last one happened in 2020, so we expect the next one in the first half of 2024.
Rather than happening at a specific future time, the next Bitcoin halving will take place when Bitcoin’s blockchain hits 840,000 total blocks. Right now, a new block is created on Bitcoin approximately every 10 minutes.
What should I do next?
If you're involved in crypto, the halving might change the price. But for most long-term users, this doesn't change much. If you're interested in Bitcoin, it's a good idea to gather more knowledge. While the halving can be exciting, don't rely solely on past events to predict what will happen. It's risky to get swept up in the hype. If you believe in crypto's future, you should invest, not just because of the halving, but anytime is a good time to invest in crypto.
Will the Bitcoin halving make you a millionaire?
I have absolutely no idea, but I’m glad you got this far.
DISCLAIMER: This newsletter is for educational purposes only and is not investment advice or a solicitation to buy or sell any assets. Please do your own research before making any investment decisions