On November 28, 2012, Bitcoin, the world’s first and most prominent cryptocurrency, witnessed a significant event – its first-ever halving. This event, programmed into the Bitcoin protocol, reduces the reward given to miners for verifying transactions by half. The purpose of halvings is to control the inflation of Bitcoin by gradually decreasing the supply of new coins entering the market.
Since the first halving, BTC’s price has experienced remarkable growth. From trading at just around $12 in 2012, it has soared to its current price of over $37,000. This impressive rise can be partly attributed to the halvings, which have reduced the supply of new BTCs, thus increasing their value.
The correlation between Bitcoin halvings and price surges is evident in historical data. Following the first halving in 2012, BTC’s price reached nearly $1,000 within a year. Similarly, the second halving in 2016 triggered a 350% surge in the year following the event, with BTC eventually reaching all-time highs of nearly $20,000 in December 2017.
The Bitcoin community eagerly anticipates the fourth BTC halving, expected to occur on April 17, 2024. Many BTC enthusiasts are particularly optimistic about the price in 2024, fueled by the prospect of the US Securities and Exchange Commission (SEC) finally approving a spot BTC exchange-traded fund (ETF).
The Future of Bitcoin Halvings
The 2024 halving won’t be the last. Bitcoin miner rewards will continue to halve until they reach 0 BTC after all 21 million BTCs are mined. Based on the current schedule, the maximum supply of 21 million BTCs will be reached around 2140.
BTC halvings have played a significant role in shaping the cryptocurrency’s price trajectory. By reducing the supply of new BTC, halvings have contributed to BTC’s scarcity, which in turn has driven up its value. As BTC matures and gains wider adoption, it will be interesting to observe how future halvings impact the cryptocurrency’s price and the overall market.