On Thursday (11), Bitcoin’s mining reward fell from 12.5 to 6.25 units of cryptocurrency per block mined. Quoted in dollars, this reward per block fell from U $ 110 thousand to US $ 55 thousand, that is, in half.

“Halving” or “halvening”
“Halving” (cut in half) is the scheduled event that halves the reward for successful validation of a new Bitcoin block every four years or so.

The cut that occurred yesterday (11) is the third since the digital currency was created in 2009, and was triggered at 16:23 hours (Brasília time), with the addition of the 630,000 block to the Bitcoin blockchain.

The first block added after yesterday’s cut (block 630,001) was mined by Antpool, the Chinese mining pool that holds the largest computational power in cryptocurrency mining in the world.

On Thursday (11), Bitcoin’s mining reward fell from 12.5 to 6.25 units of cryptocurrency per block mined. Quoted in dollars, this reward per block fell from U $ 110 thousand to US $ 55 thousand, that is, in half.

It is necessary to decrease the profit
Bitcoin was the first cryptocurrency created, and is the world’s largest market capitalization. As there is a maximum number of coins that can be in circulation (21 million), in order to simulate scarcity, the “cut in half” event, scheduled to occur every four years, aims to reduce the profits of coin mining.

With the fall in profits, smaller miners, who cannot afford the costs of the process, end up giving up the activity, which slows the inclusion of new currencies in the market. Today, there are approximately 18 million Bitcoins in circulation. The 21 million limit is expected to be reached sometime in the next century.

See Also
Latest Situation in Crypto Markets After Bitcoin Halving

Hacking events make Bitcoin mining an increasingly less attractive economic activity. Therefore, smaller miners tend to give up, or simply start mining other cryptocurrencies.

The other two cutting events took place in November 2012 and July 2016. The next one is scheduled to take place in May 2024.

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