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TL;DR
Each ~4 years, BTC turns into twice as onerous to mine – and since there’s a mounted provide of 21M BTC ever created, the ‘Bitcoin halving cycle’ has traditionally marked the beginning of a bull run.
Put up-halving, it’ll develop into twice as onerous to mine the identical quantity of BTC; so mining prices are anticipated to roughly double, making the breakeven level someplace between $20,000-$30,000.
The excellent news is: the BTC halving cycle does make BTC extra scarce. So so long as demand stays the identical, the worth of BTC ought to theoretically go up.
Full Story
Each coupla weeks we write a bit on the Bitcoin halving occasion that is resulting from happen in April 2024.
Why? Trigger it is a hella necessary mechanism to grasp in terms of the worth of BTC (and by affiliation, all crypto valuations).
To recap (and quote ourselves):
“Each ~4 years, BTC turns into twice as onerous to mine – and since there’s a mounted provide of 21M BTC ever created, the ‘Bitcoin halving cycle’ has traditionally marked the beginning of a bull run.
(Demand + shortage = individuals valuing it extra).”
However here is the factor.
At the moment, based mostly on publicly out there information (from publicly listed miners), every Bitcoin prices $10,000-$15,000 to mine.
On the present worth of simply over $26k, that is all nice and dandy. In reality, miners could make a neat revenue.
However, post-halving, it’ll develop into twice as onerous to mine the identical quantity of BTC; so mining prices are anticipated to roughly double, making the breakeven level someplace between $20,000-$30,000.
The dangerous information is: if the worth of BTC isn’t above $30,000, assuming no extra efficiencies are made (higher chips, cheaper energy and so forth.), mining operations may begin working at a gross loss.
The excellent news is: the BTC halving cycle does make BTC extra scarce. So so long as demand stays the identical, the worth of BTC ought to theoretically go up.
We do not have a crystal ball, and this positive ain’t monetary recommendation.
However hey, positive is a enjoyable idea to clarify to your drunk uncle subsequent household gathering.
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