Countdown to Bitcoin Halving: 35 days left to go
2 min readBig events cast their shadows ahead. At least that’s how you could interpret it if you look at the current price developments on the crypto market. The countdown to Bitcoin Halving is on. In around 35 days, the rewards for miners will be halved. In the past, this event was always accompanied by a bull market or a friendly price development and, by the looks of things, this halving is no exception. BTC has reached two new all-time highs in quick succession in the last few days. Bitcoin is currently trading at around 73,000 USD, so the next all-time high is within reach. The prices of altcoins are also rising accordingly. Ethereum rose by almost 8% on a weekly basis and is currently trading at around 4,000 US dollars. The global market capitalization rose by 0.65% during the day.
What is the Bitcoin Halving?
But what is this Bitcoin halving that everyone seems to be talking about at the moment and that Bitcoin enthusiasts are eagerly awaiting? Bitcoin is a deflationary token. There will only be a limited number of coins, the maximum supply is 21 million BTC. However, not all of these coins are in circulation yet – and this is where mining comes in. New Bitcoins are created through what is known as mining. The Bitcoin network uses the proof-of-stake consensus mechanism to verify transactions. In competition, the miners solve complicated algorithmic calculation tasks. Whoever solves a task first can add a block to the blockchain and receives Bitcoin in return, currently 6.25 BTC. These rewards are halved every 210,000 blocks, i.e. about every four years. In April 2024, it will be that time again. Then the BTC reward for Bitcoin miners will be “only” 3.125 BTC. The halving is firmly anchored in the code and the last one is expected to take place in 2140.
Bitcoin mining and electricity
Bitcoin is not only digital gold and a popular investment or speculation object. “The mother of all cryptocurrencies” is also repeatedly criticized for the immense electricity consumption during mining, and the data centers are often not located in countries known for sustainable energy production, for example in Kazakhstan. Electricity consumption increases especially during peak times, i.e. when prices rise, because mining Bitcoin is particularly worthwhile at this time. It is important to know that an entire industry has now developed around mining, with the threads converging with just a few major players. A well-known company in this area is Marathon Digital. Proponents argue that Bitcoin miners are able to dynamically shape their electricity consumption, which could be an incentive for countries to invest more in renewable energies. Critics complain about the high CO₂ emissions due to the high electricity consumption. However, it is rather difficult to give an exact figure for how high the energy requirements of the BTC are. Mining and the associated hardware are evolving – and not all companies rely on fossil fuels. So it could well be that Bitcoin is better than its reputation.
