Tonight, let’s get distracted from COVID-related thoughts with a hot topic of upcoming BTC’s halving, which is going to take place in a month time. To start with, here is a couple of reminders for those who are brand new to the crypto world.
Mining is basically generating new coins via solving mathematical calculations directed on carrying out transactions on the blockchain - a constant progressive chain of information blocks built according to certain rules and patterns.
Halving is a process of decreasing the speed of generating new cryptocurrency units, which both means a profit for those who purchase digital coins at this period and a loss for miners, as their reward for every created block gets twice lower.
Many experts believe that the long-awaited event of 2020 halving is going to initiate the bitcoin’s growth, which is truly exciting news for the whole crypto industry. At the same time, it raises reasonable concerns for miners whose income will be a subject to dramatic losses.
However, miners or holders, everyone involved into digital currencies market operation is naturally impatient to see what’s going to happen in the next month, what news the third halving in history will bring.
The difference between the last halving and the upcoming one is certainly going to be huge, at least due to the fact that the mining industry itself has become way more developed and professional during this period.
Since current BTC’s value is considerably lower than the medium mining value, the miners need to take an effort in preparing themselves to a challenging financial situation.
The profit of users buying bitcoins during the halving means that many miners will probably have to stop their activities for a few months afterwards, or even liquidate their assets, while the blockchain will keep developing in the same pace as usually.
It goes without saying that the miners will have hard times filled with high volatility and profit loss issues. However the holders are the lucky ones who can only benefit from the situation by accelerating their assets.
As for the matters of inflation, the “digital gold” will always be affected way less than currencies of developing countries, or, frankly, the vast majority of all existing currencies, just like real gold or GBP.
In a certain way, the bitcoin is even more stable than British Pound or US Dollar, as its use has no borders or limits. So, finalizing, in the times of surges on the financial market, BTC turns out to be a considerably more stable currency than any fiat one due to its decentralization.