Bitcoin Halving: What to Expect in the Next Cycle

The next Bitcoin halving will happen around April 2024. This blog post explains what will likely happen in the next cycle.

The next Bitcoin halving will happen towards the end of April 2024, and it’s already spurring experts’ predictions. Bitcoin halving is a quadrennial event during which the system reduces the miners’ reward by half. By decreasing the mining incentives by half, this event curbs the number of digital coins that enter circulation.

Why Bitcoin Halving Occurs

Bitcoin halving is a vital aspect of this cryptocurrency’s protocol design. It’s a mechanism for controlling new coins’ supply, which is crucial for the following reasons:

Controlling Inflation

Bitcoin halving limits this cryptocurrency’s inflation by regulating the rate at which miners release new coins to the market. The halving event keeps Bitcoin valuable and stable by reducing new coins’ issuance. Thus, Bitcoin’s halving makes this cryptocurrency a deflationary asset.

Price

Historically, Bitcoin price has increased after every halving event. The positive sentiments have sparked price appreciation since users expect the halving event to decrease supply, increasing demand. Nevertheless, Bitcoin’s past performance only sometimes guarantees the same will happen.

Market Economics and Forces

Bitcoin halving event affects the crypto market and miners economically. Since the system reduces the block rewards, miners must modify their mining operations to gain profits. This increases competition while eliminating less productive miners. Consequently, it affects the overall network decentralization and security.

Bitcoin halving happens when miners process 210,000 blocks. Since it reduces the number of new coins entering the market by half, its impact is impossible to ignore for anybody interested in this cryptocurrency. While new cryptocurrencies have emerged after Bitcoin, halving is among the characteristics that set this premier digital currency apart.

Cryptocurrencies like bitcoin, can be traded online and platforms like Immediate Altcoin, making them prone to manipulation and inflation. Thus, most people prefer Bitcoin over new cryptocurrencies because this characteristic makes it almost impossible to manipulate.

What to Expect in the Next Bitcoin Halving

The impacts of the next Bitcoin halving are yet to be precise. However, many experts believe that Bitcoin prices will follow the past three halving events. That means it’s likely to increase after the halving event due to the constrained supply of the new coins.

However, Bitcoin’s price increase will depend on the demand for Bitcoins in the market. And there’s no guarantee that demand will increase, remain static, or decrease since the crypto market has grown significantly since the last Bitcoin halving in 2020. Additionally, other cryptocurrencies are posing significant competition to Bitcoin. Here’s what experts predict will happen after the 2024 Bitcoin halving event.

Miners

Some crypto experts predict that miners may calculate their earnings from the mining activity and figure out that it’s no longer profitable due to the reduction in the reward. Consequently, they may stop mining, especially if the price of this cryptocurrency remains static. Nevertheless, this will unlikely affect the processing power of the Bitcoin network, meaning the speed of mining new blocks will remain the same as the software will adjust to the difficulty of validating transactions to keep it steady.

Bitcoin Investors

Every mining event has led to a significant and gradual increase in Bitcoin price. This has usually happened for at least one and a half years after the event. If this occurs after the 2024 Bitcoin halving event, miners will be happy since they will fetch a higher price for the new coins.

Bitcoin Traders

More people will speculate on Bitcoin price changes before and after the halving event. Therefore, Bitcoin trading will likely increase on crypto exchanges. However, always remember that Bitcoin trading can be risky due to the cryptocurrency’s volatility.

Parting Shot

The next Bitcoin halving will happen in April 2024, reducing the reward for the miners. Therefore, miners will likely adjust to the changing dynamic of the mining environment. Also, traders and investors will probably buy and sell more digital coins depending on their sentiments and price movements.