Bitcoin Halving: Is it Still a Puzzle to Solve?

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Bitcoin Halving Is it Still a Puzzle to Solve?
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How are the two significant rules related to
Bitcoin Halving?

• It has been stated that once every 210,000 blocks
  are mined, the reward becomes half for the
  miners. It has been analysed that approximately
  six blocks are mined within an hour, that means
  the halving event takes place once every four
  years (around).
• if on the date each miner is harnessing a reward
  of 12.5 bitcoins for mining a block, after the
  next halving event the reward will be halved to
  6.25 bitcoins and accordingly. The further can be
  understood by Crypto mining tutorial.

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But what is the need for halving the reward?

• Halving the reward sounds unfair for the miners!!
  But if the event does not take place, it may
  violate the basic principle of the market, i.e.
  of demand and supply.
• Thus, the halving of reward helps in maintaining
  the Value of Bitcoin in the crypto market. In
  brief, it can be explained that if the coins are
  mined at a higher pace, then there will be
  tremendous flow or circulation of bitcoins in the
  market, which would ultimately result in a
  reduced value of crypto coins.

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• Bitcoin halving leads to slacking down the number
  of new bitcoins generated by the network. The
  action limits the supply of coins which may raise
  the prices if demand is strong.
• Vitalik Buterin, the leading developer of the
  Ethereum project, explains about the requirement
  of pacing down the distribution of bitcoins
  through the way of halving.
• He further clarifies that the event takes place
  significantly to control inflation. Unlike the
  fiat currency, bitcoins are finite in volume so
  the extraction process must be controlled to
  maintain the value of the currency.

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Does Halving Affect Bitcoin Price?
Bitcoin halving has occurred twice in the past
years. In the year 2016, after the event of
bitcoin halving, the price of BTC remained in the
range of 580700 for several months, then it
slowly rose towards the end of that year. The
changes in the exchange rate of Bitcoin are
assumed against the US Dollar. It was evidently
noted that Bitcoin raised over 33x from its price
before the second halving event. Along with
bitcoin halving, some other macroeconomic factors
like uncertainty in the Chinese and European
markets was considered as the reason for the
price change of Bitcoin.
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• Though the price swayed in the months before and
  after the last halvings but the reasons for the
  same are still not clear. Thus, there is
  ambiguity related to the price of bitcoin and
  bitcoin halving events.
• The analysts are still puzzled if the price would
  rise or remain stable. Though the shortage of
  bitcoin is bound to the raised price of Bitcoin,
  the answers remain unclear regarding the price
  effect as per the latest news on bitcoin.

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Will the Upcoming Halving Event be Chaotic?
The month of MAY is expecting the event of
Bitcoin Halving when the number of blocks will
hit 630,000. The event will result in the spike
down of block reward for miners from 12.5 to 6.25
bitcoins. Bitcoins mining rewards event of
halving is significantly seen as the bullish
event that may aid in a massive amount of trade
volume of BTC due to reduced inflation. The
crypto enthusiasts, as well as potential
investors, are preparing themselves for the
fluctuation of prices of BTC. It will possibly
rise according to the analysts as the bitcoin
supply will reduce its demand is expected to
rise. But still, the unpredictability hovers
around the miners and traders of the crypto
market.
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Conclusion
The bitcoin halving event, run for safe-haven
assets during coronavirus fears and also the
stronger and safer regulations of the crypto
world can be considered as the reasons for hiking
up the bitcoins price. Nevertheless, the event of
halving cannot be stated as the sole reason for
the price fluctuations of bitcoins according to
the latest Bitcoin mining news.
Source
https//medium.com/cryptoknowmics/bitcoin-halving-
is-it-still-a-puzzle-to-solve-cd76639354b2
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