10 days to go until the Bitcoin halving

In less than two weeks, the third halving will occur on the Bitcoin blockchain, currently scheduled for May 12.

When that happens, miners’ rewards for creating new blocks will be slashed in half—down to 6.25 BTC from the current 12.5 BTC per block. Consequently, this will also reduce the rate at which new coins are minted, slowing inflation and limiting the new supply.

The next halving of Bitcoin will take place approximately at 13:30 UTC on May 12 on the block #630,000.

Over the last decade, Bitcoin’s halving occurred roughly once in four years—or once every 210,000 blocks—and will continue until the very last coin has been minted (approximately by 2140).

Previously, Bitcoin has already undergone two halvings. On November 28, 2012, the block rewards were reduced from 50 BTC to 25 BTC. Then, in July 2016, down to 12.5 BTC.

Additionally, after the halving, the annual inflation of Bitcoin will go from 3.65% to 1.8%—approximately half of the global annual inflation rate, according to Quantum Economics founder Mati Greenspan.

Notably, the halving will make Bitcoin even scarcer, as there is a hard limit of 21 million coins that could ever be mined—and a significant portion of BTC has been lost forever by now.

What about the price?

Looking at historic data, it’s almost impossible to predict what effect the next halving will have on the price of Bitcoin. Currently, we’ve seen a huge pump as the coin surged from around $7,500 to roughly $9,400 in a matter of days. But the price has headed back down to $8,800.

Catherine Coley, CEO of Binance.US, recently told Decrypt the halving is a “momentous occasion,” but she cautioned that the effects may not immediately make themselves apparent. “It could result in nothing, or could result in longer-tail adoption and a rally out of that,” Coley told Decrypt. “We saw in 2016 that the halving itself was not an instantaneous reaction, but 18 months later we had the largest rally we've seen.”

Some crypto analysts say that the current upward trend is the direct result of the forthcoming halving, as people are trying to buy extra BTC in the last moment before its supply drops.

As Decrypt reported recently, major US crypto exchange Coinbase crashed when the price of Bitcoin surged over 15% overnight on April 30. The last time this happened to this degree was summer 2017, which was followed by Bitcoin’s biggest investor influx to date.

At the same time, global interest in Bitcoin currently is nowhere near the levels of late 2017 today, according to Google Trends.

“What I think this means is: there haven't been many new entrants, however, a lot of people who already possess Bitcoin and altcoins seem to be re-active again,” crypto analyst Pedro Febrero told Decrypt.

He said the agitation in the Bitcoin market has been mostly due to current holders lately as people are preparing for the event and trying to “scoop some sweet BTC before supply halves.”

Simultaneously, as governments around the world continue to print money at an unprecedented rates to help curb the coronavirus pandemic, people are flocking to Bitcoin in search of an alternative asset to store their wealth in.