What is Halving?
The word Halving means to reduce by half. In cryptocurrencies produced through mining (Bitcoin, Bitcoin Cash, Litecoin, etc.), it is the reduction of the reward per block in mining production by half at certain intervals.
Mining is necessary not only for producing cryptocurrencies but also for confirming transfers in the blockchain system. The end of mining or slowing down of transactions will affect the usability of the system.
All cryptocurrencies produced through mining have a predetermined number of units to be produced. Units cannot be produced above the specified amount. In this way, the supply-demand balance, which is the basic element in pricing the cryptocurrency, is maintained, and inflation is prevented.
What is the Advantage of Halving?
Halving is the deliberate reduction of mining rewards at certain intervals in cryptocurrency mining. There are two main reasons for this process.
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Rewarding users who have believed in cryptocurrencies from the beginning. Users who believed in cryptocurrencies produced by mining and have been mining in this field since its inception will receive much more block rewards compared to miners who joined later, as they were not initially affected by halving operations.
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Mining operations form the foundation of the network as they are necessary not only for cryptocurrency production but also for confirming transfers in the blockchain system. The limitation of cryptocurrency units to be produced would have led to the production of all cryptocurrency units if continued with the initial block reward figures. In this case, miners would start withdrawing from the blockchain network, i.e., the mining network, due to lack of rewards, causing the system to become congested. To keep miners in the blockchain network for a long time and continue cryptocurrency production, it is necessary to reduce the block reward as the number of miners increases.
What is Bitcoin (BTC) Halving?
Bitcoin (BTC) cryptocurrency is produced through mining. Miners receive rewards in Bitcoin for each block they solve. This way, both Bitcoin production is carried out and transactions on the blockchain network are processed.
With Halving performed on the Bitcoin (BTC) blockchain, this reward per block is reduced to half its value.
Bitcoin (BTC) mining first started with the "Genesis Block" launched by its founder Satoshi Nakamoto on October 31, 2008. Subsequently, every confirmation transaction has been written on this block.
When Bitcoin (BTC) first came out in 2008, it was giving 50 BTC reward per block. Developers who anticipated that the number of miners would increase and transactions would slow down developed a system called "Halving" that would automatically reduce the reward given per block. The first halving operation on the Bitcoin network was done in 2012, and the reward per block became 25 BTC. Halving, which occurs approximately every 4 years, made its next halving in 2016, and the reward per block became 12.5 BTC.
A third halving will be done in 2020, and the reward per block will be 6.25 BTC.
The impact of the halving process on Bitcoin price has always been positive so far. Expectations are in this direction for the 2020 Halving as well.
What is Bitcoin Cash (BCH) Halving?
Bitcoin Cash (BCH) cryptocurrency is a cryptocurrency that emerged in 2017 by forking from the Bitcoin network to offer a faster system due to the slowdown of transactions on the Bitcoin (BTC) blockchain network.
Bitcoin Cash (BCH) is a cryptocurrency produced through mining, just like Bitcoin (BTC). Miners receive rewards in Bitcoin Cash (BCH) for each block they solve on the blockchain. This reward system both produces Bitcoin Cash and ensures the continuity and security of the blockchain system.
Bitcoin Cash (BCH) mining currently gives 12.5 BCH as reward per block. With the Halving to be done in 2020, the reward given per block will be 6.25 BCH.
What is Litecoin (LTC) Halving?
Litecoin (LTC) is the first cryptocurrency that forked from the Bitcoin blockchain network. It was launched in 2011 by Charlie Lee. It has the distinction of being the first altcoin.
It emerged due to the slowdown of transactions in the Bitcoin (BTC) blockchain system and the necessity of some technical arrangements. Creating faster blocks in the blockchain network enables transactions to be processed faster than on the Bitcoin (BTC) blockchain network.
Litecoin (LTC) is a cryptocurrency produced through mining and has a fixed total supply. Litecoin (LTC) will be released to the market with a total of 84,000,000 LTC units. Like other cryptocurrencies produced through mining, Litecoin (LTC) contains Halving in its system.
Halving is done in four-year periods on the Litecoin (LTC) network, and the reward per block is halved each time. When Litecoin (LTC) first came out in 2011, the block reward was set at 50 LTC. With the Halving done in 2015, the miner block reward decreased to 25 LTC. The last Halving took place on August 5, 2019, and miners will be paid 12.5 LTC per block for four years.