Cryptocurrency Halving

Cryptocurrency halving refers to the process where the reward for mining new blocks is halved, reducing the rate at which new coins are generated. This event occurs at predetermined intervals within the Blockchain protocol, typically every four years for Bitcoin. The purpose of halving is to control inflation and ensure a limited supply of the Cryptocurrency.

For example, in Bitcoin’s case, the initial block reward was 50 BTC. After the first halving in 2012, the reward dropped to 25 BTC, then to 12.5 BTC in 2016, and finally to 6.25 BTC in May 2020. Each halving event is significant as it impacts the market dynamics, often leading to increased scarcity and potential price increases.

Another case is Litecoin, which undergoes halving approximately every four years as well. The initial reward was 50 LTC, and it halved to 25 LTC in 2015, then to 12.5 LTC in 2019. Each halving has historically been followed by significant price fluctuations in these cryptocurrencies.