Bitcoin halving is here. Here’s how the crypto sector is preparing for its biggest moment every four years

• Four years later, the Bitcoin halving occurred, which would split the reward for each block from 6.25 BTC to 3.125 BTC.

• This directly affects miners, but their interest is maintained by technological advancements.

• Analysts agree that the effect will be more gradual due to the theoretical maturity of the sector.

The 2024 Bitcoin halving is just a few hours away. This is the most important event in the cryptocurrency world every four years. One that is part of the structure of the most popular cryptocurrency in the world and in which the reward for each block will be divided by two.

Everything happens as planned, but it has important consequences. Here’s how the sector’s major companies are reacting and their vision of the impact this halving could have.

Bitcoin miners will earn half. After 210,000 blocks, the Bitcoin halving occurs to try to control Bitcoin inflation. The main victims are miners. Their remuneration will be cut in half, and they understand this very well. The solution is to invest in better equipment to compensate for lower profits.

The most modern machines continue to compensate for this. In accordance with Charles Guillem notes, CTO of Ledger, this halving led to a complete sell-out of the Bitmain S21. These are mining machines costing about $4500, launched in March 2024 and running on the SHA-256 algorithm with a maximum hashrate of 200 TH/s and consumption of only 3500W.

That is, one of the most advanced Bitcoin mining machines is completely sold out, which shows that although the Bitcoin halving has already arrived, mining is still of interest to the sector.

In previous halvings, the price skyrocketed. According to Chaina analysis, the Bitcoin halving is expected to have a direct impact on the price of Bitcoin. After 2012, the price increased per year from 12 to 1000 dollars. In 2016, the price rose from $650 to $2,500 in a year, although after a year and a half it was at $19,700. After the last halving in 2020, the price increased from $8,000 to $69,000.

That is, although the reward for each block is divided, for example we now go from 6.25 to 3.125 BTC per block, as the price of Bitcoin rises, this compensates.

Go for 100,000. As Leif Ferreira, CEO of Bit2me, explains in a report on the halving: “Halving is a dance between economics, technology and human behavior, complex and full of uncertainty. Despite the difficulty in predicting its exact impact, one thing remains. It’s clear: halving is a defining moment for the cryptocurrency ecosystem.”

In the same report, economist Pablo Gil notes that “if Bitcoin finally repeats its behavior after undergoing the fourth halving, it is reasonable to expect that its price could continue to rise towards the 90,000-100,000 level.”

Now the market has become much more mature. As Chaina analysts describe the analysis: “there is an unprecedented level of anticipation.” Mainly because, unlike other cases, the major market players had already held the Bitcoin halving for a long time and were preparing for it.

Javier García de la Torre, director of Binance Spain and Portugal, explains along the same lines that “Bitcoin has historically experienced a noticeable price increase within six months of each halving.” In addition, the approval factor for Bitcoin ETFs was added this year, which increased demand and helped expand the cryptocurrency’s reach. Although he cautions that those potentially interested in cryptocurrencies are informed before taking any action. A common recommendation when it comes to assets with extreme volatility.

From Mireya Fernandez, head of Bitpanda in Southern Europe, this corresponds to the maturity of the market. And “it is precisely because of this maturity that there is no We hope that the consequences of this event will be assessed immediately.” As for the halving in 2024, “we have reason to believe that the consequences will have nothing to do with FOMO or bull run experienced in previous moments as we witness a period of maturity for digital assets.”

This cyclical event is just hours away, but if predictions are correct, it will likely take many months to see its effects.

Image | Michael Forch