The much-anticipated Bitcoin halving event just occurred. Yet, its true impact is often misunderstood

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On May 11, 2020 the reward for miners who add transactions to the Bitcoin blockchain and help secure the network decreased from 12.5 to 6.25 Bitcoins.

Some view the reduction in the number of new Bitcoins minted roughly every 10 minutes as a way to strengthen the biggest cryptocurrency’s long-term prospects.

They claim that as a result of the supply squeeze, and assuming demand holds steady (or better yet, grows), the price of Bitcoin should go higher. Plain economics 101, demand/supply rules.

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Source: https://www.bitcoinblockhalf.com/

Yet, there’s one major flaw with this theory.

You see, the reduction in daily newly minted Bitcoins from about 1,800 to 900 post-halving is negligible. …

About

Tomer Federman

Entrepreneur & early-stage investor · Previously at Facebook, SAP, multiple startups · Stanford MBA · Host, The Blockchain VC podcast · www.tomerfederman.com

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