Bitcoin halving 2020: Dates, charts and what you need to know

What will the halving do to Bitcoin prices, and why?

The Bitcoin halving is a periodic event programmed into Bitcoin. It happens roughly every 4 years.

Bitcoin was created in 2009. The first halving was in 2012, the second was in 2016 and the third is due on 12 May 2020.

Each halving reduces the speed at which new Bitcoin is created, reducing it by half. It’s widely believed that each halving significantly impacts Bitcoin prices.

What happens in the halving?

There will be a maximum of 21 million Bitcoin, but they’re being created gradually. Each halving slows down the speed at which new Bitcoin is created, reducing it by half.

The end result is that the total number of Bitcoin in existence gradually trends upwards over time, while Bitcoin’s inflation rate trends downwards over time until eventually there are practically 21 million Bitcoin in existence, and no more being created.

Each halving is a big step towards this outcome.

Why does Bitcoin halve?

Bitcoin was deliberately designed to be valuable. Its inventor described it as electronic cash and digital gold, and in order to function as money it has to be worth something.

It’s also necessary that the coin be valuable for the Bitcoin network to keep functioning. The miners who operate the Bitcoin network and help process its transactions are paid in newly-created Bitcoin, but if the coin wasn’t worth anything they wouldn’t be getting paid enough to keep doing it.

In other words, Bitcoin is only useful because it’s valuable, and it’s only valuable because it’s useful.

The halving helps support this.

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Source: Bitcoin halving 2020: Dates, charts and what you need to know | Finder