Satoshi Nakamoto created Bitcoin in 2009, he made a fabulous decentralized design where the Bitcoin can be distributed amongst miners without the involvement of any person or a group of person,This was the idea of Bitcoin Mining, where the Bitcoin miners will get some Bitcoin’s in reward for successfully solving a block, and the way this Bitcoins will be distributed amongst the Bitcoin miners , Satoshi Nakamoto put forward some rules in the Bitcoin protocol.
Rule number 1:- The total supply of Bitcoin will be limited, and will be only of 21 million Bitcoins. It means that only 21 million Bitcoins can be mined and created in the world.
Rule number 2:- Whenever in the Bitcoin Block chain 21 thousand blocks will be successfully mined, the Bitcoin reward will half, and this procedure will repeated itself until all 21 million Bitcoins are not mined.
And this event when the Bitcoin reward gets half after successfully mining 21 million Bitcoins is called Bitcoin Halving event. Initially in 2009 when Bitcoin just started, for mining, one Bitcoin block successfully managed to get 50 Bitcoins in reward, Until 2012, when the first Halving event of Bitcoin happened, just after 210 thousand blocks, the reward decreased from 50 Bitcoins to 25 Bitcoins. Second halving event happened to be in 2016 just after 420 thousand Bitcoins, the reward decreased from 25 Bitcoins to 12.5 Bitcoins. The Bitcoin rewards like this only get decreasing in every halving event, until all the 21 million Bitcoins are not mined successfully, which will probably happen in 2140.
Now the question might be coming in your mind that why the supply of Bitcoin is kept limited and why was this halving event kept? So there is a very easy answer to this question, LAW OF SUPPLY AND DEMAND. If the supply of Bitcoin was unlimited, and if Bitcoins were generated in fast rate with no halving event, than prior to time, the number of Bitcoins circulated in the market would have been so much that the value of Bitcoin would have been so less. Coming to Bitcoin’s price analysis, If we further analyse properly, the chart of Bitcoin shows positive bounce in prices after every Halving event. Two Halving has already happened and if you have analysed the price chart of Bitcoin properly than you will find that Bitcoin has breaked its previous high after the halving event. The next halving event is goint to happen in the count of 6 days.
Here if Bitcoin follows the price pattern of last two Halving event than the price of Bitcoin till halving event will come near to 11 thousand dollars to 16 thousand dollars. And in the last month’s of 2020 that is in December 2020 it can probably break its previous last time high that is of 19 thousand dollars. But remember it is not our personal opinion it is not a financial advise and we are not a financial advisor. Halving Is a burning topic which we can talk about, all this week. And according to the data that Google Trends show, Switzerland now Googles halving more than any other country in the world followed by Netherlands, Slovenia, Estonia and Austria.
Hope you might have understood about what is bitcoin halving event, why it is important, and why is it kept.