Bitcoin's third-ever block subsidy halving is about to happen.
As of the time of writing, the most recent block was 629,973 – meaning that there are just twenty-seven blocks of transactions to go until the subsidy falls from 12.5 BTC to 6.25 BTC. Depending on the rate of block production, the halving should occur sometime in the next five to six hours (though things like miner luck and variance could shift the window as well).
As this editor wrote in an explainer piece back in mid-April, the actual change taking place is a subtly notable one for the network's forward progress:
"The roughly quadrennial event is arguably an important one in the progression of the bitcoin network. For all the adjustments and changes to bitcoin's code since its launch – and the evolution of the ecosystem and industry around it – the issuance cycle and bitcoin's predetermined supply have never been altered. The halving is, perhaps, emblematic of both bitcoin's philosophical basis as well as its technical progression. It's also a heck of a lot of fun, with past halvings inspiring celebrations and watch-parties for those counting down each block until the halving officially kicks in."
On that latter point, the pre-halving celebrations are in full swing – all against the backdrop of CoinDesk's all-virtual Consensus event – as the transaction blocks tick by. Decrypt posted a handy list of places to post up and watch the countdown, but there's always the ever-expanding list of blocks.
But as we've reported here at The Block, the halving itself will likely prove a turning point in a negative sense as well. Smaller operations that sport inefficient gear or significant debt loads are likely to be swept out into the proverbial sea as their revenue is literally cut in half. Miners, generally speaking, make money through block subsidies plus whichever fees are appended to the transactions included in their blocks.
As Chun Wang, co-founder and managing partner of F2Pool, told The Block: "Often, larger farms have better economies of scale and therefore are able to survive reductions in the mining reward or price volatility."
And of course, what would a bitcoin halving post be without bringing up the oft-mentioned price impact?
The big question appears to be whether the halving is priced in. Bitcoin topped $10,000 last week before seeing a rapid plunge down to $8,100, only to jump back up. As of press time, the price of bitcoin is hovering around $8,800.
As The Block's Frank Chaparro reported on May 1, Jefferies global head of equity strategy Chris Wood suggested in a note to investors that they should buy bitcoin ahead of the halving. Woods cited past halvings, which saw price increases months after those respective events.
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