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What is Bitcoin “Halving” and What Does it Mean for its Future?
Wanna go halfsies?
I own a tiny amount of Bitcoin and when I heard that it was going through a “halving” in April, so I researched what it means for Bitcoin holders.
First, we need to understand some basic concepts on how Bitcoin (BTC) is mined to understand the halving event.
Bitcoin is on the blockchain which is composed of individual blocks. Each block has complex computational equations that need to be solved to be given access to the block. Crypto miners (similar to miners that panned for gold in California during 1849) try to find the answer to the calculations as quickly as possible.
To help them solve the mathematical problems the miners use high-end computers that are built specifically for this task, and they are called “nodes”. These nodes keep refactoring the answers to the equations until they successfully crack the block. The more power the computer has the more attempts can be made to come up with the correct answers.
It’s a race to find the solution since the first node that unlocks the mathematical puzzle can add the newly mined block to the blockchain ledger. The miner is also granted a block reward which is new Bitcoin. Since there is sizable expense involved in creating the new Bitcoin it is usually immediately sold…
