Halving the reward for the block: what it is and how it will affect the price?

 Feature of Bitcoins is limited emission. The number of bitcoins that can be mined, has a limit. Issue is carried out according to the previously fixed plan. The nearest milestone in this plan will begin in July 2016: halving the reward for the block, or simply “Halving”.

The website, which shows the countdown to Polovinnaya reward for finding a block, provides useful information about when the reward for each block (on average every 10 minutes) will drop from 25 to 12.5 bitcoins. It happens every 210 000 blocks, which means that the next halving of the reward will occur in the summer of 2020.

Total_bitcoins_over_time
The number of mined bitcoins in the timeline
It is not an event that can be taken lightly. It's like the world Cup, which can only be seen once in four years. In fact, the event is so special that you can call it unique. We don't even really know what effect it will have on the market price of bitcoins. Last time, after Polovinnaya awards, bitcoin price has increased almost 100 times in the next year – from 12 to 1200 in the peak. Beat if BTC:USD to a maximum of all time due to reduction in offers bitcoins in the market after Polovinnaya awards in July? It's hard to say.

It is obvious that the miners will be the first to suffer losses from changes in rewards. Their profits will decrease, and therefore some of them will strike out. In fact, it's already starting to happen – recently announced its bankruptcy, the largest European miner KnC Miner from Sweden. With the departure of the miners, the complexity of the production will fall, and then the remaining miners will demand higher remuneration.

So that the miners left in the game, maybe we will all have to pay a slightly higher transaction fees than the standard of 0.0001 BTC charged now. At $500 per BTC, the fee for the transaction seem minor, but if the price will increase together with the increase in the fee for the timely confirmation of the transaction, for some users it may be too.

But is it simple? Will increase the price just because the offer from the miners decrease? Or the impact of this change will be unpredictable for the price?

It is unlikely that it will adversely affect the economy of the Bitcoin ecosystem. On the one hand, halving the reward for the block is stitched in the Protocol, people know about it, and waiting a long time considered by the market. However, the press is sure to be a sensation. And it can spur excitement. If in addition to take into account the emergence of a large number of new and interesting projects and startups that will culminate with the release service on the market in 2016 that can turn a bullish invigorating cocktail.

When is the halving?
The exact date of Polovinnaya reward for a block is impossible to determine, but now it is expected that this will happen July 10, 2016, plus or minus a few days. Technically, this is only one of a long series of “polovinkami” that will continue approximately every four years. To specify the date and time of Polovinnaya on the site http://www.bitcoinblockhalf.com/ 

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