The Bitcoin (BTC) network has successfully completed its fourth halving event.
On April 19, the rewards earned by cryptocurrency miners were reduced to 3.125 Bitcoins from 6.25 previously. The halving effectively cuts the available supply of Bitcoin by 50%.
The price of Bitcoin, which had been volatile in the days leading up to the halving, is now on the rise, having gained 2% in the last 24 hours to trade at just under $66,000 U.S. per token.
Halving events are built into the underlying code of Bitcoin and occur every four years. After previous halving events in 2012, 2016 and 2020, the price of Bitcoin rose sharply higher.
However, each halving event has tested cryptocurrency mining companies that must compete for much less supply of Bitcoin.
Halving events effectively cut the revenues of crypto miners in half and can lead to a wave of consolidation and business closures across the industry.
Stocks of crypto miners have also been volatile, with many down by double digits on the year. Riot Platforms (RIOT) is down 41% in 2024, while Marathon Digital (MARA) is down 28%.
Several Wall Street analysts, including at JPMorgan Chase (JPM) and Deutsche Bank (DB), have said that they expect Bitcoin’s price to fall in the near-term after the latest halving.
The banks cite overbought conditions, a decline in Bitcoin exchange-traded fund (ETF) inflows, and subdued venture capital funding of crypto projects as reasons for their negative outlooks.
Despite the recent volatility, Bitcoin is up 50% on the year and currently trading below its March 14 all-time high of $73,797.68 U.S.
